FRANKLIN PIERCE LAW CENTER GERMESHAUSEN · PDF fileGERD F. KUNZE “THE FATHER OF THE ......

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INSIDE THIS ISSUE:

U.S. News & World ReportRanks Pierce Law in TopFive for IP Law / 1

Portrait: Gerd Kunze / 1

IP Faculty Activities / 2

Notable Happenings / 3

Who Invented thatJoint Invention? / 4

Satellite Radio BenefitsConsumers andRecording Industry / 5

Trademarks and theFirst Ammendment:The Hybrid Natureof Internet DomainNames / 7

Protection of TraditionalKnowledge Under theModern IntellectualProperty Laws / 9

Jurisdiction andthe Internet / 11

Fuzzy Math Solvedin the Great E-FlatMajor Sonata ofFranz Joseph Haydn / 13

Secure Digital MusicInitiative / 15

Student Profile:Desire Rubadiri / 17

From the Editor / 19

G E R M E S H AU S E N C E N T E R N E W S L E T T E R • Su m m e r 2 0 0 2

See KUNZE, page 2

F R A N K L I N P I E R C E L A W C E N T E R

U.S. NEWS & WORLD REPORT RANKSPIERCE LAW IN TOP FIVE FOR IP LAWFOR 11TH CONSECUTIVE YEARU.S. NEWS & WORLD REPORT again ranked Pierce Law among the top five law schoolsin the nation for the study of IP law today in its latest edition of “America’s Best GraduateSchools 2002.” This marks the 11th consecutive year that Pierce Law has been named amongthe top five for the study of IP in the magazine’s annual rankings. Pierce Law maintained itsnumber three position in the IP specialty category, and moved up from the fourth tier to thethird in the overall ratings.

“We have been very successful in maintaining our enviable position in intellectual propertyover the past decade, and are gratified to have moved up in the overall ratings,” says PierceLaw Dean John Hutson.

PORTRAIT: DR. GERD F. KUNZE“THE FATHER OF THE TRADEMARK TREATY”BY LAURA NELSON (JD ‘04)

R. GERD F. KUNZE has been an adjunct professor at Pierce Law since 1995. Dr.Kunze returned in March to instruct a two-week mini course, International and

Comparative Trademark Law and will return to Pierce Law later this summer.He is currently of Counsel at Walder Wyss & Partners, Zürich, Switzerland and sits

as the current President of the International Association for the Protection of IntellectualProperty (AIPPI). Dr. Kunze first came to Pierce Law at the request of Professor Karl Jordashortly after retiring from Nestlé.

I had the distinct pleasure of meeting Dr. Kunze during his recent visit to Pierce Law. I wasso intrigued by his vast array of experiences that one meeting was simply not enough. Wespoke on several occasions and I was truly impressedand inspired by each event.

Dr. Kunze received his law degree from the Universityof Heidelberg in 1960 and his Doctor at Law fromthe University of Heidelberg (magna cum laude)and passed his Second State Examination (which inGermany is a condition for becoming an attorney ora judge) in 1963. He began his professional career asan Assistant Professor at the Institute for CommercialLaw, University of Heidelberg in 1964. This experiencegave him the opportunity to work with his mentor,Professor Hefermehl, editor of the leading Germannotebooks on unfair competition and trademark law,and to gain a new perspective on his work. He later

FRANKLIN PIERCE LAW CENTER

DR. GERD KUNZE

G E R M E S H AU S E N C E N T E R N E W S L E T T E R • Su m m e r 2 0 0 2 E d i t i o n

Published by the Kenneth J.Germeshausen Center for the Law of

Innovation and Entrepreneurship

Editor:Karl Jorda

Student Editor:Marnell Boehmer (JD ’03)Assistant Student Editor:

Troy Watts (JD ’03)Administrative Editor:

Carol RuhPhotography:

Carol Ruh/Linda Turner

Created in 1985 through thegenerosity of Kenneth J. and PaulineGermeshausen, the GermeshausenCenter is the umbrella organization

for Pierce Law ’s specializationand policy studies in the legalprotection, management, and

transfer of intellectual property,especially relating to the

commercialization of technology.The Germeshausen Center Newsletter

is published three times a year foralumni/ae, students and friends

of Pierce Law.

Our readers are encouragedto send news, photos,

comments or letters to:

Carol RuhFranklin Pierce Law Center

2 White StreetConcord, NH 03301 USA

[email protected]

GERMESHAUSEN CENTERNEWSLETTER

was admitted to the bar in Frankfurt, Germany, and served as a member of the legal staff ofthe German Nestlé group and served as Chief Trademark Counsel at Nestlé’s headquartersin Switzerland from 1976 through 1991, later serving as an Intellectual PropertyConsultant with Nestlé. Dr. Kunze has also been an Adjunct Professor at the John MarshalLaw School, Center for Intellectual Property Law, in Chicago since 1995.

Dr. Kunze is fluent in German, French, and English, and has a good knowledge of Spanish.He conducts seminars and regularly speaks on intellectual property and related issuesthroughout the world.

Dr. Kunze is active as advisor and as representative of NGOs at the World IntellectualProperty Organization (WIPO) in Geneva and sits as a Panelist at the WIPO ArbitrationCenter. He began his work with WIPO as an industry representative while working forNestlé in the early 1970’s. Dr. Kunze has made enormous contributions to the field ofintellectual property throughout the world. It is this work which he is most proud. Hislong term efforts and cutting-edge theories paved the way for the development of theTrademark Law Treaty which was ratified in 1994 and has since been sanctioned andimplemented by many countries world-wide. What a tremendous legacy to leave withinan industry which he has actively participated and served as a change agent for nearly

KUNZE, from page 1

See KUNZE, page 7

Graphic Design & Typography:Ampers&® Studio, Newmarket, NH

IP FACULTY ACTIVITIESProfessor Nermien Al-Ali presented aprogram entitled “Where Are You on theIntellectual Capital Continuum (IC): aTool for Organizations to Assess TheirIntellectual Capital Management Programs”

at the Fifth World Congress on IntellectualCapital Management held this past Januaryin Hamilton, Ontario. She also presented aseminar on “Strategic Intellectual AssetsManagement” at Intertech’s High Performanceand Functional Pigments Conference 2002in Delray Beach, FL this past January.

Professor Bill Hennessey participated inthe Advisory Council of the WorldIntellectual Property Organization’s (WIPO)Worldwide Academy in Geneva, Switzerlandon February 6. He also delivered a paperand moderated a panel on “Protection ofTraditional Knowledge and Folklore” at theWIPO Caribbean Regional Symposium inPort-of-Spain, Trinidad, on February 27.Furthermore, he joined a team from theUSPTO and US Department of Justice fromApril 12-21 to discuss “enforcement ofintellectual property rights” with Chineseattorneys, law enforcement, trade, andcustoms officials in the cities of Shanghai,Nanjing and Dalian, China.

On June 7, Professors Bill Hennessey andJohn Orcutt conducted a seminar on IP and

capital markets in Shanghai and Hangzhou,China. They also began teaching in thePierce Law-Tsinghua University IntellectualProperty Summer Institute (CHIPSI) onJune 10-July 12. Twenty-four American lawstudents are participating in the program.

Professor Craig Jepson attended a symposiumon “Patenting Genetic Products” presentedby the Center for Interdisciplinary Studies,Washington University at St. Louis Schoolof Law with Professor Richard Epstein andauthor Horace Freeland Judson on April12-13, 2002.

Professor Karl Jorda spoke at the WIPO/UNITAR Academy on “Intellectual PropertyRights for Diplomats” at the United Nationsin New York City on March 25. He alsopresented a talk as part of a workshop on“How to Develop University-IndustryCooperation” at the LES International2002 Annual Conference held in Osaka,Japan on April 7-10.

F R A N K L I N P I E RC E L AW C E N T E R 3

NOTABLE HAPPENINGS…SCHOLARSHIP AWARDProfessor Bill Hennessey announced thispast winter that Pierce Law received a giftof $30,000 in support of a scholarship forgraduate students engaged in the teachingof IP law from the William F. SibleyFoundation in Chicago.

VISITING DELEGATIONTO PIERCE LAWA delegation of government officials andmedia representatives from 25 nations andregions visited Pierce Law on March 7,sponsored by the Phelpes Stokes Fund ofthe US Department of State. The visit waspart of a three-week itinerary to the majorindustries and technology sectors in the USfor which strong IP protection is criticallyimportant. After a warm welcome fromDean Hutson to brush away the snowychill of New Hampshire in early March,Pierce Law faculty members Tom Field,Jon Garon, Bill Hennessey, Karl Jorda andSusan Richey met with the delegation aspart of the day-long program. Topicscovered included patent term, trade dressprotection, teaching IP and “HollywoodLaw.” There was also a wide-ranging round

table session for the visitors, representingAlgeria, Armenia, Ghana, Indonesia, Israel,Jordan, Latvia, Lithuania, Malaysia, Morocco,Namibia, Nepal, Philippines, Russia, Senegal,Singapore, Thailand, Uruguay, and the WestBank. The program is part of ongoingcooperation between the US governmentand Pierce Law to increase internationalawareness of the importance of IPprotection to economic development.

IP MALL: WHAT’S NEWContributions by Professors Field,Hennessey and Jorda have been added.Professor Eugene Quinn (‘95 ) invitedPierce Law to create a mirror site to hismany publications. Sumant AkramKhan (‘02 ) offers pieces dealing withhis Internship at the World IntellectualProperty Organization (WIPO) Divisionas well as his paper “Cooperation andCoercion: The Protection of IntellectualProperty in Developing Countries.”

To visit any of these sites select “IP MALLHosted Resources” in the IP Mall: http://www.ipmall.piercelaw.edu.

4TH BASIC PATENTCOOPERATION TREATY(PCT) SEMINARPierce Law held this seminar April 26-27in cooperation with WIPO. This year’sspeakers were Louis Maassel, Consultant,PCT Legal Division, WIPO and DavidReed, Section Head, International PatentDivision, Procter & Gamble Company,Cincinnati, OH. The well-attended (150)seminar provided participants with in-depthknowledge and understanding of the PCT.

VISITING SCHOLARMs. Margi Patel, the Director of theInstitute of IP Studies (IIPS), Shri VileParle Kelavani Mandal (SVKM), A.J.College of Commerce & Economics,Mumbai (Bombay), and a similar one inHyderabad, India visited Pierce Law forone month to explore cooperationbetween Pierce Law and her institutes.

SINGAPOREDELEGATION VISITA delegation of the Intellectual PropertyOffice of Singapore (IPOS) visited PierceLaw on July 2 in connection with plansto establish an IP Academy in Singapore.Their delegation included the IPOSChairman, Professor Hang; the IPOSDirector-General, Ms. Liew; the AssistantDirector, Ministry of Law, Mr. Poon andMs. Ramli, Manager, IPOS KnowledgeDevelopment Department, BusinessDevelopment Group. They wanted to visitand meet us for “some exchange of ideas.”

A DELEGATION OF GOVERNMENT OFFICIALS AND MEDIA REPRESENTATIVESFROM 25 NATIONS AND REGIONS VISIT PIERCE LAW.

4TH PCT SEMINAR HELD AT PIERCE LAW.


WHO INVENTED THAT JOINT INVENTION?BY VINCE MACRI (LLM ’03)

N THE WINTER ’02 ISSUE, novicelawyer F. (Fictitious) Allniter (thenunder cloak of anonymity) struggled to

prepare for a last minute assignment to anIAM (intellectual asset management) project.This spring, Allniter confronts the “…exactparameters of what constitutes joint inventor-ship…. It is one of the muddiest conceptsin the muddy metaphysics of the patentlaw.” Mueller Brass Co. v. Reading Industries,352 F. Supp. 1357, 176 U.S.P.Q.(BNA) 372(D.C. PA 1972).

We fall in stride with Allniter three days beforea first vacation from professional practice.This short period of intrigue is spent inassociation with no less than two sanescientists, a furtive computer programmer“X” (and ‘advisor’), a new and commandingR&D Director, one overreaching companyVP and his wife’s marginal nephew, twolaboratorians, one from Tokyo the otherVienna, a competent computer scientist andloyal assistant, a consulting salesperson, onemysterious night worker at R&D and anoverabundance of facts, eponymous names,places, documents, motives and personalitiesthat need (as usual) to be sorted out, or in.Allniter’s lawyering will be predominantlyfact-based (or based on alleged facts, as weshall see), however an overview of some ofthe law will be useful.

As a rule lawyers are trained to apply the lawto the facts. When the law is statutory, thecardinal rules of construction are that thelegislature is deemed to have used no super-fluous words and that courts ascribe plainmeaning to all the words. Allniter keepsthose rules in mind while sorting out who(natural persons) are the joint inventors ofa new, useful and non-obvious invention 35U.S.C. §§ 101-103 (1994), and ipso factowhat is inventorship.

The time frame for determining inventorsis generally a no-brainer, i.e. between thedates of the innovators’ conclusive notebookentries (or invention disclosure documenta-tion) and filing an application for a patent.

Determining qualifications for inventorship(not ownership) is less mechanical and moresubtle. Discovering a problem or imple-menting a solution are alone insufficientqualifications. Explaining the state of theart or introducing a component or productto be used in the invention also fall short ofinventorship. At the same time, the cartooncharacter’s symbolic overhead light bulb ofinsight or a flash of genius without some-thing more is likely to be deemed simply anunqualifying flash in the pan. Allniter knowsthat inventorship hinges on the original useof conceptual faculties linked to a definite/permanent description of the innovation sothat anyone skilled in the art could reducethe teaching to practice. Joint inventors musthave collaborated in this kind of conceptionand teaching.

The decision-maker for designating inventorsis a natural person, but not (excepting prose representation) the inventor or inventors.Designation is a high stakes move in thepatent gambit with no less than patentvalidity at stake. How is patent validity atstake? Allniter is certain that at this stage oflawyering, validity depends on the truthfuland accurate designation of inventors.Sections 35 U.S.C. 102, 111, 115, and 116(1994) are interrelated requirements of astatutory gateway that opens for what maylater (for additional reasons) become avalid U.S. patent. The patent statute provides:

§ 102 “A person shall be entitled to apatent unless…(f) he did not himself inventthe subject matter sought to be patented,…”

§ 111 “(1) Written Application…forpatent shall be made…by the inventor…”

§ 115 “The Applicant shall make oath thathe believes himself to be the original andfirst inventor of the [invention]…for whichhe solicits a patent.”

§ 116 “When an invention is made by twoor more persons jointly, they shall apply forpatent jointly….”

35 U.S.C. §§ 102, 111, 115, 116 (1994).

Regarding the foregoing statutory commands,“shall be,” “shall be,” “shall make,” and

“shall apply,” §§ 102, 111, 115 and 116respectively, Allniter recalls a presentationby Carol T. Carr, Esq., Associate I.P. Counsel,Massachusetts Institute of Technology.That presentation sparked Allniter’sthought that both positive and negativesuccesses are needed in getting namedinventors right. Positive success flows fromstrict compliance with at least the foregoingsections of 35 U.S.C. Negative success flowsfrom avoiding the kinds of pitfalls outlined inAttorney Carr’s “Common Misconceptions:”

“Authorship is equivalent to inventor-ship. Someone who works on aninvention deserves to be an inventor.The heads of the company, lab,institute, (etc.) should be named as aninventor. Knowledge derived in thecourse of proving an invention entitlesone to be an inventor.”

Presentation by C.T. Carr, Esq. at FranklinPierce Law Center, June 16, 2000.

With this outline of when (initially) inven-torship is decided, the qualifications andcollaboration required of joint inventors,who makes the decision to designateinventors and common misconceptionsregarding inventorship in mind, we joinAllniter during three days of intrigue.What is in store for Allniter? If identificationof joint inventors (and by implicationinventorship) is a matter of federalstatutory compliance and the case law isdependably consistent (which it is) whythen does Allniter face a challenge?

On the 362nd morning after Allniter’s firstday as a patent lawyer, reporting to work isespecially uplifting. It’s Wednesday, July 12and Friday will be finish up and off to theislands for several weeks of vacation. Your(Allniter’s) expectation is for a fairly relaxed,few days. The company patent departmentor, as the case may be, law firm partnersand other associates are all off on annual“retreat,” leaving you, Allniter, alone andsolely in charge.

I

See JOINT INVENTION, page 5


The office telephone is ringing as you enterat 7:45 a.m. “Attorney Allniter,” says thecaller, a voice you recognize as that of thenew R&D Division Director, Dr. ActonAplomb, “have you read the fax and e-mailwe sent to you yesterday?” “No,” you reply,“when was that?” They were sent about 11p.m. and we need some answers right away,”grunts Director Aplomb. After promising areturn call within minutes, you ring off andread the messages.

“O.K.,” you say to yourself, they’ve comeup with a method, a clinical laboratoryblood test method to detect a patient’sprobability of carrying any one of acurrently unmanifested cluster of humangenetic disorders. They believe it’spatentable subject matter. Not unusualas that’s their mission, to invent. Thisdiscovery, if it gets as far as a patentapplication, will be prepared by yourcolleagues after you’ve gone off on vacation.You will start by collecting the inventiondisclosures from the relevant scientists,take a look at their laboratory notebooksand prepare an initial memorandum foryour patent attorney colleagues to workfrom. Independent prior art searches (and/or those already gathered by the scientists)could take days to review. Drafting claimsin concert with the inventors and workingback into preparing specifications disclosingthe problem(s) solved by the inventionand the best mode could easily stretch overweeks of work. If this laboratory methodhas the markings of a fundamental inventiona great deal of attention from many differentlevels of business and legal quarters will bepaid to it. It all won’t happen now, in threequiet mid-July days, while everyone’s awayand your vacation is about to begin. But then...

Your return call to Dr. Aplomb complimentshim on the findings of the laboratory methodand his R&D Division’s description of theresults. “Of course, Attorney Allniter,” Dr.Aplomb replies, “these are limited findingsbased on our few in-house human samples


F

SATELLITE RADIO BENEFITSCONSUMERS AND RECORDING INDUSTRYBY LESLIE C. ADAMS (JD ‘03)

RUSTRATION from constantly pushing the seek button on car stereos andwanting to pull off the road during a road trip to hear the last few lyrics of a

favorite song are not uncommon occurrences for drivers who are about to lose yetanother local radio station as they travel in and out of short broadcasting ranges. With theintroduction of digital satellite radio, drivers can now drive from Florida to California withoutever losing their favorite channel.

In November 2001, XM Satellite Radio (“XM”) was the first to launch its satellite radioservice nationwide and operates by digitally transmitting 100 channels of music, newsand entertainment from its Washington, D.C. based studios to two geostationary satellites,“Rock” and “Roll.” The satellites send powerful, encrypted nationwide signals back toEarth. Subscribers pay $9.99 a month for the service, which can be received by small carantennas. To support the satellites in areas where reception may be blocked, XM hasinstalled 1,000 “repeater” towers to rebroadcast the signals. The result is virtually uninter-rupted, digital-quality radio programming throughout the United States with little orno commercial interruptions.

Chief Programming Officer Lee Abrams of XM is quoted on XM’s Web site as saying, “We’reblowin’ up the rule book and starting over…. It’s the only way to create something completelynew and adventurous.” <http://www.xmradio.com/how_it_works/programming.html>(accessed Jan. 1, 2002) That being said, current copyright rules have survived this newinnovation, requiring XM music service to license the copyright owners’ exclusive rightsto perform the work publicly and to publicly perform the sound recording by digitalaudio transmissions.

A major difference between traditional analog radio and digital satellite radio is what itmeans for licensors. As a result, not only will composers and music publishers receivemoney for licensing their public performance rights in musical compositions, but recordcompanies and artists, who usually only receive non-financial benefit from radio broad-casting as a means to promote record sales, will also benefit financially from the digitalaudio transmission of the sound recording due to statutory licensing provisions in theCopyright Act.

All radio broadcasting falls within the copyright owners’ exclusive rights to perform thecopyrighted work publicly. A public performance can be transmitted “by any device orprocess where by images or sounds are received beyond the place from which they aresent.” 17 U.S.C. § 101 (2000). Congress intended for this to encompass future broadcastingtechnologies not known at the time. H.R. Rpt. 94-1476, 94th Cong., 2d Sess. 64-65 (1976). Aslong as the transmission reaches the public, regardless of form, it is a public performance.

Thus, regardless of whether the transmission of a copyrighted work is sent to a satellite inouter space before it reaches the public, it is still subject to licensing from performing rightssocieties such as ASCAP, BMI or SESAC, which negotiate on behalf of composers andmusic publishers.

Additionally, companies like XM that are subject to statutory licensing provisions regardingthe digital audio transmission of the sound recording, will have to pay record companies aswell for licenses obtained through the Recording Industry Association of America (RIAA),which is acting as a performing rights society for the recording industry.

See SATELLITE RADIO, page 15

JOINT INVENTION, from page 4


and we are awaiting final experimental testresults and ‘outcomes’ from the field.” “Thefield?” you ask. “Yes,” says Dr. Aplomb, “weof course sent this out for clinical trials andresults are coming in from Dr. M. Kokubo’slaboratory in Tokyo and Dr. A. Ruppel’slaboratory in Vienna.” “And this is entirelyexperimental?” you ask. “Oh, yes,” repliesAplomb, “exported under experimentaldevice exemption with written assay protocolsand a description of the method. We chargedthem for only our cost to put test kitstogether, plus a little overhead of course. Wedo have a budget to worry about you know.”

“You described the invention and soldthem, Kokubo and Ruppel, in Tokyo andVienna, test kits,” you say out loud (it beingunclear whether you are talking to yourselfor to Dr. Aplomb) and, you continue, “dideither of these international lab directorssign confidentiality agreements or contributeto the method?” “Well yes and no,” says Dr.Aplomb, “for the most part they used ourkits ‘as is’ to test, and charged their patientsonly nominal amounts. Each of them didmake suggestions, which we incorporatedinto second and then third generations ofthe assay, this third generation being what wewould like you to put into a patent application.As to confidentiality no, neither was askedto sign such an agreement, we are all scientistsyou know.” “Dr. Aplomb,” you ask, whilestruggling for air, “when, that is, when, didyou first sell these kits and disclose descriptionsof use of the invention to anyone in Tokyo,Vienna or anywhere else in the world?”“Just a moment,” after keeping you on holdfor several minutes, Aplomb confirms thatthe earliest sale date was last year, July15th

and R&D simultaneously informed Kokuboand Ruppel how to construct and operatethe lab method in case anything went awryso far away. Stunned, you mumble that you’lldrive over to Aplomb’s office immediatelyand hang up. A wave of numbness passesthrough your corporeal personal property.Reflexively, you look at the calendar. Todayis July 12th, you knew it was.

Of course you have to check into the factsat R&D first hand, but thanks to Professor

Karl F. Jorda’s mentoring the issue lights areflashing one year on-sale bar to patentability,inventorship and joint inventors, employeeagreements, assignment of ownership, andthe dreaded, ‘patent invalidity.’ And, this isjust for analytical openers. You cell-phonehome while driving (a poor practice) andleave a late day return message. It’s 8:00 a.m.,and you know where all your back-up is:gone. You ponder whether it’s possible thatyou have only about 63 hours to prepare andfile a patent application on a potentiallyblockbuster invention. Who to call forexperience? Again on the cell phone, CarolRuh answers that Professor Jorda has lots ofexperience with desperately truncated timeframes for filing, but he’s off giving a talk to300+ patent lawyers in Vladivostock. Yourcar nearly swerves off the road.

Word of your imminent arrival at the R&Dlab has gotten around and you are greetedwith expectant glances, excited expressionsand a general atmosphere of financialharvesting. The R&D personnel have knownfor a time, almost a year for some, that thisparticular lab method could be something bigand the international test results have con-firmed their expectations. You are introducedto two scientists, Dr. R. Green and Dr. E.Marco, who “put this whole thing together,”you are told by Director Aplomb. Whatyou hear, however, are whispered echoes of‘conception,’ ‘collaboration,’ ‘reduction topractice’ and ‘diligence.’ “These are theinventors,” says a backslapping Aplomb, “and I’d like you to list me (Acton Aplomb)and Drs. Kokubo and Ruppel, as well, on thepatent application, because they madeseveral key suggestions which improved themethod.” You thank Aplomb and makenotes thinking maybe, but in any event thedesignation of inventors is your professionalresponsibility.

You study and interview, through the daylighthours. The invention disclosures and lab-oratory notebooks of Drs. Green and Marco(there are no other R&D scientists involved)show that these two scientists jointly collabo-rated, in the same general time frame toformulate and disclose a complete conception

of a new, useful and non-obvious innovation,each contributing different types and amountsof input, which together sets forth asolution to a problem. Both scientists, abio-chemist and molecular biologist, confirmthat working together they came up withthe concept of testing for levels of certainsubstances in human blood, the presenceand proportions of which, in combinationwith other patient data, would be indicativeof the probability that a tested patient coulddevelop one or more of a range of geneticdisorders. They cannot say exactly howmuch each has contributed to the conceptof this method, but offer assurances thateach has jointly contributed. Their boundnotebooks, describing an assay methodology,have been corroborated by knowledgeablecolleagues signing and dating each page ofeach notebook. Their invention disclosures(Green’s and Marco’s) point to the likeli-hood of drafting quite broad claims.

You question Drs. Green and Marco aboutother R&D personnel, or any others, makingcontributions and they answer “no, only us,we came up with the idea and did someinitial assay development in our lab, no oneelse at R&D was involved.” As to the Tokyoand Vienna scientists, Green and Marco tellyou that Kokubo discovered that addingcertain buffers to the assay for targeted bio-chemical markers enhances the assay’srobustness and Ruppel found that preparingthe specimens at 18-20 degrees centigrade,before assaying, yields more precise quanti-fication. This will take more work on yourpart, but you suspect that Kokubo andRuppel are more than likely contributors tothe reduction to practice of the invention,are “skilled in the art” and not likely to beinventors of this invention. Indicating thatyou will need some night hours to lookover the documentation, Green and Marcoleave the conference room.

Furtively, a 25-30 year-old (software program-mer “X”) enters through the back door ofthe conference room without knocking.Facing you from the opposing side of the




TRADEMARKS AND THE FIRST AMMENDMENT:THE HYBRID NATURE OF INTERNET DOMAIN NAMESBY BRYAN ERICKSON (JD ’03)

ISPUTES OVER Internet domain names have become a prominent new issue forcivil litigation since 1995. New laws and systems have arisen specifically to address

domain name disputes as a category of their own. The Anticybersquatting ConsumerProtection Act (ACPA) was passed in November 1999 to deal with cases of cybersquatting,or trafficking in a domain name with the “bad faith intent to profit” at the expense ofsomeone with a trademark interest in the terms used in the domain name (15 U.S.C. §1125 (d)). Many domain name disputes are now being dealt with in the regularizedalternative dispute resolution system known as the Uniform Dispute Resolution Policy(UDRP), organized by the Internet Corporation for Assigned Names and Numbers (ICANN),the non-profit corporation responsible for technical coordination of the Internet aroundthe globe.

However, a domain name dispute in a U.S. court, not involving a cybersquatter, does nottake advantage of either of these recent legal innovations. The more traditional and settledlaw applying to these cases comes from two tried-and-true areas: First Amendment lawand trademark law. The U.S. Senate made this clear by providing in the ACPA that “Nothingin [the ACPA] shall affect any defense available to a defendant under the Trademark Act…or a person’s right of free speech or expression under the first amendment…” (106. P.L.113 S. 1948, § 3008).

First Amendment law protects freedom of expression, while trademark law protects theability of the public to identify the source of a product or service. A domain name mightjust as easily qualify as an organizational source identifier (commercial or otherwise), oras a forum of expression. The basic goals of these two doctrines often conflict, sincetrademark protection places targeted limits on speech. These limits on speech apply undercertain specific circumstances, such as to prevent infringement of a trademark. (See generally15 U.S.C. §§ 1114, 1125.) This tension between trademark law and First Amendment lawexisted long before the Internet, so domain name disputes can benefit from precedent inother settings that considered the “dual interest…in not being misled and…also…inenjoying the results of the author’s freedom of expression.” (Rogers v. Grimaldi, 875 F.2d994 (2d. Cir. 1989) (discussing the dual interest of trademark law and First Amendmentlaw in the title of a movie, one analogous setting to an Internet domain name)).

Along with the similarities of domain names to more traditional settings for this dualnature, there are also important differences in how domain names lend themselves totrademark law and First Amendment law. A domain name has no special claim tostrength as a trademark. It qualifies for trademark protection only by complying withthe same criteria as any other mark in commerce, i.e. strong public recognition and thecapability of federal registration. Typically, a domain name only achieves wide recognitionas a trademark if it is promoted in the same way as any other trademark, and it functionssuccessfully as a source identifier. This requires that the trademark be distinctive. A domainname is subject to the same scrutiny for distinctiveness as are other potential trademarks.There are four general levels of distinctiveness suitable for trademark protection: (1) generic,(2) descriptive, (3) suggestive, and (4) arbitrary or fanciful, in order from weakest to strongest.(See generally Abercrombie & Fitch v. Hunting World, 537 F.2d 4 (2d. Cir. 1976)).

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three decades. This legacy certainly entitleshim to be considered the “Father of theTrademark Treaty.”

Dr. Kunze’s long-term efforts have alsohelped in the development of the MadridSystem for the International Registrationof Marks, which has gained acceptanceworldwide. When speaking with Dr. Kunzeabout his related interests and hobbies heperked up and laughed in a peculiarmanner. “I love to work. It is trulyrewarding to continue to work with theinterests of the world.” He is energizedthrough his work with young people,which has compelled him to continue toteach. Dr. Kunze also enjoys gardening,playing tennis, and downhill skiing whenhis knees are in agreement.

I could not help but ask Dr. Kunze to sharehis lifelong secret for success. He explainedthat it was quite simple. His work with hismentor in Germany helped him to “developan analytical approach to looking at legalproblems” which he carried forth in practice.He believes this approach has given him anadvantage over his colleagues in industryand has attributed to his success. “Thissystematic approach has always helped me.”Obviously Dr. Kunze was wise in his earlyyears and sought the benefits of a mentorearly in his career, which proved to be adecision that impacted him throughouthis career.

Dr. Kunze is the author of numerous pub-lications relative to European and inter-national unfair competition and trademarklaw including: The Protocol Relating tothe Madrid Agreement Concerning theInternational Registration of Marks,Introduction to Trademark Law andPractice: a WIPO Training Manual, TheMadrid System for the InternationalRegistration of Marks as Applied underthe Protocol, The Trademark Law Treaty:Managing Intellectual Property,Improving the Protection of Well-KnownMarks: Introduction to the new WIPOProvisions, and numerous other articles,books, and publications.

Dr. Kunze is the current President andMember of Honor of the InternationalAssociation for the Protection of Intellectual

KUNZE, from page 2

See KUNZE, page 13


conference table, X leans forward and says,“you know Attorney Allniter, I’ve beenfollowing this profitable discovery forabout a year and since it looks so profitableI’d like to say that I did the computerprogramming for the multi-variate analysisthat the testing calls for and I really thinkI’m a co-inventor of this profitable discoveryand I really, really think of myself as aconceptual digital inventor and since I’m aco-inventor, my sister’s boyfriend, who is asecond year law student (not at Pierce Law)says, that under 35 U.S.C. 262 (1994), I maybe entitled to a profitable undivided interestin the entire invention, that is to say I canindependently sell or license the inventionfor a lot of money since I was not hired toinvent but I did invent and no one can suefor infringement of this invention withoutmy participation as a plaintiff because I aman inventor (therefore, I control exclusively)and I have not assigned my rights to the

company or Green or Marco and am I, andcan I, and how much?” Amazed, you guessthat what X just said is the longest run-onsentence in the history of human speech.Putting that aside you inform programmerX that you have a duty to your client, thecompany, and cannot give X legal advice.You suggest that the law student contactyou and give X your business card. To X’sparting comment that you can expect aphone call very soon, you do not reply.

Night worker Zilber peeks inside the con-ference room to introduce himself. You areglad to meet Zilber, but busy and mustkeep working.

Next to uninvitedly enter the conferenceroom are Kris, an R&D lab assistant, andPat, a computer scientist. Both, apparentlywith design, have overheard programmerX. They inform you that they too believethe lab method discovery is “very big business”

but refute programmer X’s claim to co-invention. Kris and Pat show you theiruncorroborated diaries in which there arenotations proving that they collaborativelyimplemented the computer programmingto “crunch” the numbers derived from thetest protocol’s multi-variables. They ask tobe named as co-inventors since the labinvention doesn’t work commercially, i.e.on large volumes of throughput of humanspecimens, without the computer program.Kris and Pat suggest that programmer X isquite furtive and subordinate, has workedonly as directed by Pat to make minorprogramming changes and has been withthe company only six months. The computerprograms, they prove, are older than that.They leave and you call home again to sayyou’ll be very, very late.

DOMAIN NAMES, from page 7


Some of the Abercrombie test may be appliedto domain names in general, as a specialcategory of source identifiers. Doing so leadsus to two broad conclusions about thepotential for domain names to serve as sourceidentifiers or trademarks. Both conclusionssuggest a special ability of domain names toescape the fate of the weakest source identi-fiers, beginning life with a head start on theAbercrombie ladder.

First, it is very difficult for a domain nameto be generic. In an Abercrombie analysis, ageneric source identifier has no potential togain strength as a trademark. (Id. at 9.) Themark “apples” for the sale of apples couldnever achieve trademark protection. Thesame applies to a Middle Eastern restauranton the southern corner of MassachusettsAvenue and Brookline Street in Cambridge,Massachusetts, whose signs read “MiddleEast Restaurant” as the only identifier ofthe establishment. Its owners would neverbe able to exclude another Middle Eastern

restaurant from promoting itself under thegeneric mark “Middle East Restaurant.”

However, since a website is such aninherently unique service or format forservice, there are few conceivable domainnames that could generically describe theirsubject. The website “internet.com,” whichfeatures news about the Internet, may bethe best example of a generic domain name.Another example is the website “website.com,”which reviews websites. Further examplesare the websites “web.com” and “webpage.com,”which are Internet hosting sites.

On the other hand, a domain name thatgenerically describes the subject matterdiscussed in the website cannot be generic.For instance, “apples.com” is a website withlinks to apple-growing organizations. Thename of the website generically describesthe subject matter discussed in the site,whose aim is to educate the public aboutapples and to promote their consumption.

But such an aim is a step above sellingapples under the mark “apples.” Since thewebsite is not itself a bushel of apples, thedomain name is elevated to descriptivestatus rather than generic. The same followsfor almost any mundanely named website.

The second reason domain names functionas effective source identifiers is that eachone must be unique. The Internet requiresthat no two websites anywhere in the worldcan share the same domain name at thesame time. This contrasts starkly with thecase of traditional source identifiers, whosechances for trademark strength are oftenruined by the number of other products orcompanies using an identical mark. Suchwide usage by several businesses causes themark to become diluted, and thereforeincapable of trademark protection for anyof the companies using it. Professor ThomasField counted 27 different companies usingthe mark “Granite State” in the Concord,




Night worker Zilber peeks inside theconference room and volunteers help. Youthankfully decline assistance.

After interviewing Dr. Aplomb it is irrefutablethat the assay was sold and disclosed toKokubo and Ruppel on July 15th of lastyear, 363 days ago. Dr. Aplomb is informedof the on-sale bar rule, 35 U.S.C. § 102,and that you must prepare to file anapplication for a patent on or before theend of two days hence, Friday July 14th.Aplomb asks if this on-sale bar thing is anew rule and “what’s the big rush,” towhich you rejoin that on-sale bar has beenthe law since about 1836 and applies tothinner actions than those taken byAplomb. For example, if (for one year) aproduct has been the subject of a contractto supply (public use) and is described indrawings or specifications sufficientlydisclosive to “enable someone skilled in theart to practice the invention,” the on-salebar rule can be enforced to barpatentability, Pfaff v. Wells Elec. Inc. 525U.S. 55, 48 U.S.P.Q. 2d. (BNA) 1641 (1998).

You suggest to Aplomb that the scientists,Green and Marco, computer scientist Pat,lab assistant Kris, programmer X and allothers at R&D be asked not to leave thebuilding without seeing you first andreiterate that there is a lot of work to dovery quickly on the patent application.

A salesman/consultant’s phone call is putthrough to you in the conference room.He is announced as Mr. R.U. Real, changedfrom Leal, as he explains, “for businesspurposes.” You politely explain that sellingchemicals to the R&D Division and givingadvice on running immuno-assays doesnot qualify one as an inventor. Real ringsoff saying, “really, well, if the method fliesmy commission will be enough.”

Kokubo from Tokyo and Ruppel fromVienna both send e-mails indicating thatthey’ve heard of company plans to patentthe laboratory method. Each claims to bea co-inventor. Aplomb’s superior, DivisionVice-President, Dr. Iam Formidable phones


PROTECTION OF TRADITIONAL KNOWLEDGEUNDER THE MODERN INTELLECTUAL PROPERTY LAWSBY ANNICK TCHOKONTE (LLM ‘02)

HE CONVENTION on Biological Diversity (CBD) has estimated that the marketfor herbal medicines therapies, including herbal products and raw materials, hasreached $43,000 million with an annual growth rate between 5-15 percent. It

has been estimated that the vast majority of plant genetic resources and other forms ofbiodiversity are found in, or originate from, developing countries. As traditional andalternative medicine plays an increasingly important role in healthcare and the healthsector globally, it has become critical to reconcile protection of the intellectual propertyrights between holders of traditional knowledge to those of modern technologies. Oftenin most situations, knowledge of traditional medicine is patented and filed by scientistsof developing countries, with little or no compensation to the custodians of this knowledgeand without their prior consent.

Associated with these forms of exploitation is a serious concern that developing countries,especially traditional knowledge holders, may be exploited. Some advocates point outthat a conscientious use of crucial resources must exist among various partners tomaintain the diversity of medicinal plants. Increased use of medicinal plants, inappropriateharvesting methods, commercialization, and a growing demand on the markets are allfactors that threaten the sustainability of biodiversity (International Development ResearchCentre, News Release 2001). In recent years, a worldwide controversy has been raging overthe grant of intellectual property rights over biological diversity under the current TradeRelated Aspects of Intellectual Property Rights Agreement (TRIPS). Some critics have arguedthat crucial differences in rationale exist between the CBD and the TRIPS Agreement. TheTRIPS Agreement is said to favor the commercial interests of large companies, at theexpense of the conservation of natural resources. (Letter of the Africa Faith and JusticeNetwork and the Washington Office on Africa to the Office of the US Trade Representative,September 15, 2000). Acknowledging the increasing importance of this issue, in 1998, theWorld of Intellectual Property Organization (WIPO) conducted nine fact-finding missionsin order to identify the intellectual property needs and expectations of holders of traditionalknowledge. The results were published in a report entitled “Intellectual Property Needsand Expectations of Traditional knowledge Holders: WIPO Report on Fact FindingsMissions (1998-1999).” Later in January 2002, an international forum was organized byWIPO in cooperation with the Sultanate of Oman entitled “Intellectual Property andTraditional Knowledge: Our Identity, Our Future.” The forum focused on the growingneed to protect expressions of folklore and traditional knowledge. Participants expressedtheir concerns as to the protection of the intellectual property rights of traditionalknowledge holders under the existing system.

Characteristically, traditional knowledge is not mass produced, but created in accordancewith individual or community needs. Furthermore, traditional knowledge is orally trans-mitted from generation to generation and thus remains largely undocumented. (WIPOInternational Bureau, Muscat, January 21-22 2002). The forum agreed on the implementationof a pilot project on collective acquisition, management and enforcement of intellectualproperty of traditional knowledge. In light of WIPO’s exploratory work conducted in 1998and 1999, the forum further agreed on the necessity for the 2000-2001 work program tomove beyond issue-identification and into a phase of testing practical solutions for theprotection of traditional knowledge. However, such initiatives do not resolve the current

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See KNOWLEDGE, page 16



New Hampshire phone book. (ThomasField, “Trademarks and Business Goodwill,”http://www.piercelaw.edu/tfield/trademk.htm).A monument to trademark failure can beseen in Salt Lake City, where two entirelyunrelated businesses both named “Dynatec”have their corporate headquarters acrossBangerter Highway from each other. Theypractice a frequent ritual of directingmisguided deliveries across the street toeach other (or did until November 2001,when one of them filed for bankruptcy).

Domain names are saved from the possibilityof this sort of confusing duplication of marksin commerce. Their inherent uniqueness is,however, a double-edged sword. The globaluniqueness of domain names also meansthat a trademark holder cannot duplicatean independently owned domain nameincorporating its trademark. Congress becameconcerned about “the use of deceptiveInternet addresses taken by those who arechoosing marks that are associated with theproducts and reputations of others,” in thewords of Senator Patrick Leahy (D-VT) (ascited by the court in the seminal cyber-squatting case Panavision Int’l. L.P. v.Toeppen, 945 F. Supp. 1296, 1302, referringto a new trademark dilution statute). Suchabusive domain name registrants are whatbecame known as cybersquatters. Just as asquatter is someone who occupies realproperty belonging to another, a cybersquatteroccupies a position in cyberspace thataccording to trademark law is the intellectualproperty of another. The gap in legalprotection available to trademark owners inthe novel legal setting of cybersquatting ledto the creation of the ACPA.

Many domain name disputes, though,involve two entities with a genuine interestin a trademark embodied in the domainname for which they are competing. TheAmerican Bar Association, for example, wasunable to register the domain name “aba.com”because it had already been taken by theAmerican Bankers Association, while“aba.org” was already taken by the AmericanBirding Association. (Jane C. Ginsburg etal., Trademark and Unfair Competition

Law, p. 509.) In another example, NissanMotor Company could not register thedomain name “nissan.com.” It had alreadybeen taken by an apparently innocent prioruser, Nissan Computer Corporation, whosefounder and president’s surname is Nissan.Nissan Computer Corporation has beendoing business in one form or another underthe trademark “Nissan” since before NissanMotor Company began using that mark inthe U.S. (See Nissan Motor Co., Ltd. v.Nissan Computer Corp., 2000 U.S. App.LEXIS 33937 (9th. Cir. 2000), (remanded,litigation ongoing; see also generallywww.nissan.com).

As for First Amendment law, there has beensignificant judicial uncertainty over whethera domain name itself serves as a valid forumof expression (Planned Parenthood Fed’n.of Am. v. Bucci, 1997 U.S. Dist. LEXIS3338, 35 (S.D.N.Y. 1997) (holding that thedomain name served only as a sourceidentifier and not as communicative speech);Bally Total Fitness Holding Corp. v. Faber, 29F.Supp.2d 1161, 1167 (C.D.Cal. 1998)(holding that the domain name constitutedspeech protected by the first amendment);Name.Space, Inc. v. Network Solutions, Inc.,202 F.3d 573, 585 (2d. Cir. 2000)(suggesting in dicta that domain namesmight be a forum of expressive speech);National A-1 Advertising, Inc. v. NetworkSolutions, Inc., 121 F.Supp.2d 156 (D.N.H.2000) (holding that the domain name isnot a valid forum for speech)).

Such cases have consistently danced aroundbut avoided the crucial question of whetherforum validity or invalidity should be theinitial presumption. In other words, is a novelpotential forum of expression presumed validand protectable under the First Amendmentunless shown invalid, or should it be presumedinvalid and not protectable unless shownvalid? National A-1 went the furthest of thesecases in denying the forum validity of domainnames. In doing so, it drew criticism fromFirst Amendment activists such as the FreedomForum (www.freedomforum.org). Thedoctrine of forum invalidity as a curb onFirst Amendment rights arose in special

case forums such as private property andpotential riots (See e.g. Feiner v. New York,340 U.S. 315 (1951)). It’s hard to see howthose special cases can be extended to domainnames, let alone to create a presumption ofinvalidity for any novel forum of expression.The First Amendment is not to be tossedlightly aside.

Many of these cases also suggested thatdomain name disputes would disappearfrom the U.S. courts as quickly as they hadarrived because of the establishment of theUDRP by ICANN—coincidentally, inNovember 1999, the same time as the passageof the ACPA. National A-1, for instance,envisioned domain name disputes shiftingover exclusively to UDRP proceedings.However, this enthusiasm to slough offdomain name disputes was misplaced. Onone hand, UDRP is much quicker and lessexpensive than litigation in U.S. federalcourt. However, UDRP proceedings do“not have binding effect other than on theregistrar… and [do] not foreclose thepossibility to submit the case to nationalcourts in a competent jurisdiction.” (Dr.Annette Kur, UDRP, A Study by the MaxPlanck Institute for Foreign and InternationalPatent, Copyright and Competition Law,Munich, Germany, 2001.) Therefore, aUDRP decision does not subject a disputeto res judicata, and creates the uncertaintyof leaving the dispute open to futurelitigation. (John E. Ottaviani, It’s Not Over‘Til It’s Over: Domain Name Holders WhoLose UDRP Proceedings Have Redress Underthe Anticybersquatting Consumer ProtectionAct, Intellectual Property Today 36,March 2002).

In fact, two very recent cases confirm thatU.S. courts are willing to ignore completelya prior UDRP proceeding and start fromscratch (Sallen v. Corinthians LicensciomentosLTDA, 273 F.3d 14 (1st. Cir. 2001);Barcelona.com, Inc. v. ExcelentisimoAyuntamiento de Barcelona, Civil Action00-1412-A (E.D.Vir. Feb. 22, 2002)). InCorinthians, the First Circuit overruled the




prior decision of the UDRP. In Barcelona,the Eastern District of Virginia held infavor of the same party who won theUDRP proceeding, but along the way heldthat the U.S. Trademark Act “contains nolanguage which would dictate that adistrict court must give any deference tothe [UDRP] arbiter’s ruling…the [UDRP]panel ruling should be given no weight…”(Barcelona slip opinion at 5.)

Corinthians and Barcelona are also notablebecause in both cases, no party was nativeto the U.S. In Corinthians, both sides of thedispute were Brazilian; in Barcelona, bothparties were from Spain. Regardless of this,the U.S. courts accepted jurisdiction of thecases because the ACPA extends trademarkprotection under U.S. law to any “owner ofa mark” against any “person” (15 U.S.C. §1125(d)(1)(A)). This in rem jurisdictionover domain name disputes between anyparties around the world persists becausedomain names must still be registeredin the U.S. Corinthians and Barcelonahave sent a clear message: the U.S.federal courts remain the World Courtfor Domain Name Disputes, ICANNand UDRP notwithstanding.

Because of their novelty, domain namedisputes are driving new interpretationsof trademark and First Amendment law,particularly due to new legal mechanismssuch as the ACPA. As the recent surprisesin Corinthians and Barcelona amply show,this body of law is still in the formativestages. This leaves a lot of room for creativityto an attorney representing a party in adispute over an Internet domain name.

Bryan Erickson (JD ’03)is from Rochester, NewYork. He has a BS inPhysics and Astronomyfrom Brigham YoungUniversity. He plans topractice IP law upongraduation.

JURISDICTION AND THE INTERNETBY NANCY B. DELAIN (JD ‘03)

HE INTERNET has no territorial boundaries. To paraphrase Gertrude Stein, as faras the Internet is concerned, not only is there perhaps ‘no there there,’ the ‘there’ iseverywhere where there is Internet access.” Digital Equipment Corp. v. AltaVista

Technology, Inc., 960 F. Supp. 456, 462 (D. Mass. 1997), quoted in “InternationalJurisdiction in Cyberspace: Which States May Regulate the Internet?” by Stephan Wilskeand Teresa Schiller, 50 Fed. Comm. L.J. 117, 161 (1997).

The internet has no boundaries; it is “everywhere where there is Internet access,” Id.Hence, the question of personal jurisdiction of a lawsuit based on harm caused incyberspace becomes entangled in a morass of long-arm statutes, both in the United Statesand abroad. In the United States, it is becoming entrenched in caselaw.

PERSONAL JURISDICTION AS TO INTERNATIONAL INTERNET DISPUTES

It is as easy for an Internet “surfer” to visit a website whose files are physically located in acomputer halfway around the world as it is to visit a website whose files are physicallylocated within the same jurisdiction as that within which the “surfer” sits. For example,Yahoo! runs a website in the United States; users can access that website by simply typing“http:// www.yahoo.com” into their browser software’s locator field. Yahoo! also runs awebsite in the UK, just as easily accessed from the United States by typing “http://www.yahoo.co.uk.” Is the UK website vulnerable to personal jurisdiction in the UnitedStates simply because a user in the U.S. (or anywhere else in the world) can access thewebsite?

The Restatement (3rd) of the Foreign Relations Law of the U.S. describes jurisdiction toadjudicate as:

(1) A state may exercise jurisdiction through its courts to adjudicate with respect to aperson or thing if the relationship of the state to the person or thing is such as to makethe exercise of jurisdiction reasonable. Restatement (Third) of the Foreign Relations Law ofthe U.S. 401 cmt. a (1987) at 421(1).

This standard applies to both civil and criminal adjudications, with the proviso thatthe connection between the forum state and the cause of action must be sufficient orreasonable. Reasonableness in the international forum is defined when jurisdiction isasserted. The international reasonableness standard is significantly different from theUnited States’ minimum contacts standard for jurisdiction; transient presence in theforum, for example, is insufficient grounds for jurisdiction internationally. If the internationalinternet case is a criminal one, the presence of the defendant is generally required forjurisdiction; in civil cases, the plaintiff generally must sue in the defendant’s forum.There are very few international internet-related cases; most of the litigation regardingthe internet has been within the United States. I therefore concentrate the remainder ofthis article on the United States.

PERSONAL JURISDICTION AS TO INTERNET DISPUTES WITHIN THE U.S.

Traditional personal jurisdiction is firmly rooted in the concept of finite jurisdictionalborders. When a plaintiff wishes to sue a defendant outside of the forum where thedefendant would normally expect to be sued, the plaintiff must establish that thejurisdiction of the court would comport with “traditional notions of fair play andsubstantial justice.” Milliken v. Meyer, 311 U.S. 457, 463 (1940). The presence of theinternet has not changed this basic concept. Traditionally, two types of personaljurisdiction exist within the U.S.: general and specific.

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See JURISDICTION, page 18



to suggest that “it would be nice” to see hiswife’s nephew (Iam Clenly), who is employedin the R&D lab to wash beakers and testtubes, have his (Clenly’s) name on the patentand that “it would look good on his resume.”You make a written note to discuss thissuggestion with your chief patent counseland, if necessary, the company’s energeticgeneral counsel, P. Pepi, and quick-wittedPresident, J. Pepi.

Night worker Zilber again peeks inside theconference room to volunteer assistance.You again politely demur.

After perusing the documents and prior artagain, you conclude that there is patentablesubject matter in the lab method. You checkagain and sure enough, the on-sale bar ruleprovides for a one-year grace period (to filea patent application) from the time a product(here test kits) is the subject of a disclosureand/or commercial offer for sale. There isno escape. Dr. Aplomb and the documen-tation have confirmed the public use date asinitially July 15th of last year. Your deadlinearrives midnight July 14th. You haven’tthought of vacation all day.

For a trusted dialogue, you phone your lawschool colleagues Mills and Onello. Theygraciously brainstorm with you. Several‘bottom lines’ are developed. Inventorshipis a knotty subject, deriving its legitimacyfrom the fact of conception. Who conceivedof the invention and what conception meansare the issues. Joint inventorship has its ownrules, which obviously subsume inventorshipcriteria and go further to give guidance forfiling as a plurality of inventors. Mills andOnello remind you of the less than recent(1897), but still solid Merenthaler decision:

The conception of the inventionconsists in the complete performanceof the mental part of the inventive act.All that remains to be accomplished,in order to perfect the act orinstrument, belongs to the departmentof construction, not invention. It istherefore the formation, in the mindof the inventor, of a definite andpermanent idea of the complete andoperative invention, as it is thereafter to


be applied in practice, that constitutesan available conception, within themeaning of the patent law.

Merenthaler v. Scudder, 11 App. D.C. 264,276, (D.C. Cir.1897) adopted in Gunter v.Stream, 573 F. 2d 77, 80, 197U.S.P.Q. (BNA) 482, 484 (C.C.P.A. 1978);Coleman v. Dines, 754 F.2d. 353,359, 224U.S.P.Q.(BNA) 857, 862 (Fed. Cir. 1985).”Please see also Burroughs Wellcome Co. v.Barr Lab, Inc. 40 F.3d 1223, 32 U.S.P.Q 2d(BNA)1915 (Fed. Cir. 1994), Collar Co. v.Van Dusen, 90 U.S. (23 Wall) 530, 563-64(1874).

In general, co-inventors (two or more) neednot physically work together, they may makedifferent types or amounts of contributionsand they need not have made contributionsto all of the claims (no longer an all-claimsrule) of the patent. There is no specificquantum of inventive contribution requiredof each co-inventor and no guide as to howmany inventors may be jointly engaged(Canon v. Nukote, 134 F.3d 1085 U.S.P.Q.2d (BNA) 1355 (9th Cir 1998) where sixteeninventors were named on an ink jet invention),but each must have contributed significantlyto the conception of the invention and eachwill have an undivided interest in the entirepatent notwithstanding contribution of, forexample, 4 of 55 claims, Ethicon, Inc. v.United States Surgical Corp., 135 F.3d 1456,45 U.S.P.Q. 2d (BNA) 1545 (2d Cir.1998).

Under 35 U.S.C. § 116, as Allniter notedearlier, co-inventors “shall” apply for a patentjointly. Invalidity can be based onmisjoinder or non-joinder with deceptiveintent. Standing to bring infringementactions can be jettisoned by improperjoinder. ‘Jointly’, is not surplusage, it iscentral to filing a patent application by co-inventors and to validity and enforcement byco-patentees or their assigns.

Given all the claimants to joint inventorshipencountered by Allniter thus far, Green,Marco, Aplomb, Programmer X, the sales-person/consultant, computer scientist Pat,lab assistant Kris, Iam Clenly, and who knowswho else, Allniter re-reviews § 116 to findthat joint inventors may qualify as such

even though: they did not physically worktogether at the same time, each did not makethe same type or amount of contribution,or each did not make a contribution to thesubject matter of every claim of the patent(the death knell to the older all-claims rule).35 U.S.C. § 116.

Section 116 was amended in 1984 to fosterco-researcher collaboration, which in amodern, technologically driven economy isresponsible public policy. However, thislegislated policy has not made life easierfor the patent lawyer bearing responsibilityfor naming the true inventors on a patentapplication. What § 116 giveth, defensecounsel for alleged infringers may takethaway, with the help of judicial constructiondetermining ‘joint inventors’ to mean preciselywhat it says, i.e. the right ones, not misjoinedor non-joined inventors and, vitally, not withdeceptive intent. If deception is involved,even the curative, correctability value of 35U.S.C. 256 (1994) will be lost.

The patent attorney bears initial responsibilityfor determining who is an inventor and inextreme cases, where an attorney causes afalse oath of inventorship to be filed, criminalconvictions may ensue under 18 U.S.C. §1001 (2000).

Collaboration means that the invention isconceived by two or more persons during acommon period of developmental work. Thesupportive sets of dates cannot be faciallyinconsistent to qualify for co-inventorship.

Inventors, taking collaboration and conceptionas a unified whole, will not lose their rightsby using the services and ideas of others.Those that merely identify problems or, onthe other hand, improve the solution arenot using inventive faculties, nor are thosesupplying inventors with well-knownprinciples, or state of the art improvements,Chirichillo v. Prasser, 30 F. Supp. 2d 1132, 49U.S.P.Q. 2d (BNA) 1437 (E.D. WI 1998).

You suggest and Mills and Onello confirmthat in Seawall v. Walters 21 F. 3d 411, 30U.S.P.Q. 2d (BNA) 1356 (Fed. Cir. 1994),



EX. 1: HAYDN – “ADAGIO” FROMSONATA NO. 62 IN E-FLAT, MEAS.48, HENLE EDITION

Property (AIPPI) and regularly representsAIPPI in meetings of WIPO-ExpertCommittees in Geneva. The AIPPI is a world-wide nonprofit organization, consisting of65 national groups and over 8000 membersin over 100 countries, devoted to improvingand promoting the protection of intellectualproperty on both an international andnational basis. The organization works toachieve this objective by working for thedevelopment, expansion and improvementof international and regional treaties andagreements and also of national laws relatingto intellectual property.

As President of AIPPI, Dr. Kunze will overseethe next Executive Committee meeting inLisbon, Portugal from June 17-21, 2002. TheXXXIX World Intellectual Property Congresswill convene in Geneva, Switzerland, June 19-24, 2004, and Dr. Kunze will then relinquishhis Presidency. Boston will serve as host to theXXXXI World Intellectual Property Congressin September 2008, and Dr. Kunze willcertainly play a vital role in the conference.

In addition to Dr. Kunze’s numerouscontributions to the world of intellectualproperty, he is also past member of theBoard of Directors and past Secretary andInternational Officer of the InternationalTrademark Association (INTA), member ofthe European Communities Trade MarkAssociation (ECTA), and member of theSwiss Arbitration Association.

Dr. Kunze’s experience and insight into theglobal market are exceptional and uniquecomponents of his classroom environmentand to the learning experiences available inintellectual property at Pierce Law. Dr.Kunze found a mentor early in his careerand utilized the experience as a valuablelearning tool. Perhaps you too will be asfortunate as Dr. Kunze and will findinspiration and learning tools that will lasta lifetime as well.

Laura Nelson (JD ‘04)has a BS in Mathematicsand Computer Sciencefrom Pikeville Collegein Pikeville, KY. She hasan M.Ed in Administrationand Supervision from

the University of New Hampshire. Sheplans to practice in New England upongraduation.

KUNZE, from page 7 FUZZY MATH SOLVED IN THE GREAT E-FLAT MAJORSONATA OF FRANZ JOSEPH HAYDN (1732-1809)BY ELIZABETH HOCHBERG (JD ‘03)

CCORDING TO the surviving autographed manuscript, Sonata No. 62 in E-Flat(Hob. XVI:52) (The Great E-flat Major) was dedicated to the pianist Therese

Jansen Bartolozzi, a pupil of Clementi, in 1794. Miss Jansen’s name appears on alist of pianists Haydn met in London, and Haydn composed his last three Piano Sonatas(Nos. 60-62; XVI: 50-52) in 1794 and later three Piano Trios for her.

Miss Jansen arrived in Vienna in 1799 to find all of one of her sonatas (No. 61) and part ofanother (No. 60) published and doing quite well. Because she had chosen not to publishher three sonatas in England, it is not known where the publishing house Artaria receivedits engraver’s manuscript, for neither Haydn nor Miss Jansen sent any copies to them. MissJansen acted quickly with the news, arranging for the manuscript of No. 62 to be deliveredto Longman & Broderip, who first engraved the Sonata No. 62.

Any modern composer—well, any copyright student, too—would cry out if in today’sworld a composition was published and making money for the publisher without any kindof arrangement or written consent from the composer. Lawsuits would be filed and majordamages would probably be awarded. Unfortunately, composers like Haydn and hiscontemporaries did not have control over their works as musicians do today. It was notuntil major Romantic composers like Schumann, Liszt, and Brahms put up a fight in themid-nineteenth century that composers finally wereable to enforce any kind of copyright in their music.

A big sonata in every sense of the word, Sonata No.62 requires power, dexterity, and expression. (A. PeterBrown, Joseph Haydn’s Keyboard Music: Sources andStyle 361 (Indiana Univ. Press 1986)). It has beendescribed as a work that is a fulfillment of theclassical sonata that points the way to the future. Therenowned musicologist H.C. Robbins Landon asserts that this sonata falls into a groupwith Mozart’s C minor Sonata (K. 457) of 1784 and Beethoven’s “Pathetique” Sonata, Op.13, of 1799 as the most influential piano sonatas of the late eighteenth century. (H.C.Robbins Landon, Haydn Chronicle of Works: Haydn in England, 1791-1795 vol. 3, 452(Thames and Hudson 1976)).

Aside from the many interesting aspects of style and theoretical advancements presentedby this sonata, what endears the piece to me is a rather small but significant rhythmicdiscrepancy I found while learning it for my Master’s Recital. I knew that in the pre-1780sonatas arpeggios were written out only at thematically significant moments. However, inthe second movement of this piece, a monothematic Adagio, Haydn chose to include veryprecise arpeggiated notation. In the Adagio, independent arpeggios were written for boththe right and left hands in a new concert-style type of movement. (Laszlo Somfai, TheKeyboard Sonatas of Joseph Haydn 97 (U. Chi. Press 1995)).

Imagine my surprise to find a mathematical discrepancy at measure 48 of the GermanHenle edition. The modern 1974 Henle edition I was studying from was considered to bethe most accurate, and was set from the Schirmer edition of 1897. The Schirmer editionwas set from the original Longman & Broderip engraving. I noticed that the manuscriptstill bears the red crayon marks and other notes from Longman’s engraver.

The rhythmic problem lies in the first half of beat two of measure 48, where Henle hasprinted a sixteenth note on high G (ex. 1).

A

See FUZZY MATH, page 18



the court explains that conception existswhen a definite and permanent idea of anoperative invention, including every featureof the subject matter sought to be patentedis known. Conception is complete whenone of ordinary skill in the art couldimplement the method or construct theapparatus, without unduly extensive researchor experimentation.

Mills and Onello are thanked profusely forthe brainstorming session. Then you prepareto clear the decks of all non-inventors.

Night worker Zilber again peeks inside theconference room offering to help. Againyou politely decline the gesture.

At 10 p.m. on July 12th, you reach DivisionVice-President Iam Formidable at his countryclub. After some delay and over the din ofuproarious background noise, you pointout that the VP’s wife’s nephew, Iam Clenly,does not qualify as an inventor and will notbe designated as such. You explain conception,solution, contribution to claims and jointinventorship and close by complimentingthe VP on nephew Clenly’s work on thebeakers and test tubes. Formidable meeklyrings off.

At 10:30 p.m. Dr. Aplomb is diplomaticallyinformed that he (Dr. Aplomb) is in nephewClenly’s non-inventorship category, withoutusing those words. Aplomb is also compli-mented on the condition of the beakers andtest tubes and he accepts your accolade as atestimonial to his commanding managementof R&D.

At 11 p.m. Drs. Kokubo and Ruppel are advisedof the U.S. law in Seawall and Chirichillo. Theyrespond in their respective languages.

Furtive programmer X is conferenced at11:30 p.m. and informed that having workedas one skilled in software art, the program-ming contribution went to the implemen-tation of an already conceptualized inventionand did not require the use of inventivefaculties. Furtive programmer X replies,“no problem, I’ll just take the overtime payfor staying this late.” Chewing gum loudly,X leaves the conference room.

Kris and Pat are called in past midnight andinformed that their work diaries disclosedthat they were acting within the scope ofthe invention as explained by scientistsGreen and Marco and that they (Kris andPat) had excelled in providing computerapparatus/software support, but are mostlikely reduction to practice personnel notco-inventors. They leave co-muttering.

Finally, Green and Marco meet with youafter 1 a.m. You inform them that theinventorship decks seem to be cleared andin less than 48 hours a patent applicationmust be filed (electronically) with theUSPTO. (You are waiting to hear fromProfessor Jorda on the dismal outlook forwhether this invention can be protectedinternationally). “There’s just one questionI have,” you, a puzzled Allniter, ask, “asscientists with biochemistry and biologyPh.D.’s, how did you know to incorporateBayes’ Theorem in your probabilityalgorithms?” Simultaneously, each pointsto the other and says, “oh, you did it.” Youexhaustedly investigate for the answer to whomade the Bayes probability contributionand determine that neither Green nor Marcohad contributed this piece of computer/statistical input and neither knew who had.You call home to ask if a fresh change ofclothes, etc. could please be brought to thecompany R&D lab at dawn.

Allniter keeps digging and finds that companynight worker (Zilber) had contributedunsolicited computer/statistical expertiseto Green and Marco by amending thecommon text of the disclosure of the inven-tion appearing on Green’s and Marco’scomputer terminals. Zilber is a hereto-fore, undisclosed collaborator. He is anintellectually gifted, nighttime worker,inconspicuously dressed in blue jeans andblack Knapp shoes. Zilber’s contribution,which could be a fact pattern for a movie,was completely unsuspected and unheralded.This joint inventor is a blue-collar, math-ematical/computer genius working as amanual laborer. Who could have guessedZilber would have conceived of theapparatus, algorithms and computer

software programs to combine the assayresults with other variables?

Allniter is spending another all-nighterputting the co-inventorship, conceptionand collaboration pieces together and hasless than 48 hours in which to draft claimsand specifications before one year expires.Allniter maintains goodwill at the R&D labwhile hunting for all the answers, facts andtechnical data needed to support a validpatent application. By 11:45 p.m. FridayJuly 14th the application is filed electronically.The inventors are Green, Marco and Zilber.Allniter assembles the files, writes severalmemoranda (noting future continuation inpart and divisional issues) and leaves forhome while the birds are chirping in a newday (the first day of vacation).

Vince Macri (LLM’03) received his lawdegree from theUniversity of Virginia.He practiced law formore than 20 yearsand worked as abusiness executive for

over 10 years before returning to lawschool at Pierce Law as an LLMcandidate.


SATELLITE RADIO, from page 5

In 1998, the Digital Millennium CopyrightAct amended the scope of copyright owners’exclusive rights in sound recordings to bringother digital audio transmissions underthe statutory licensing provisions, whichincluded pre-existing satellite digital audioradio services such as XM.

Interestingly, voluntary negotiations todetermine the statutory rates and termsfor licenses ended with no agreement.Since then, XM and its competitor SiriusSatellite Radio (“Sirius”), along with theRIAA have petitioned the Librarian ofCongress requesting that the statutorylicense rates and terms for pre-existingsatellite digital audio radio services bedetermined by a Copyright ArbitrationRoyalty Panel (CARP).

After several years, it is still unsettled asto how much companies like XM will haveto pay to record companies for licenses,and it is likely that in-car entertainmentwill continue to develop and may one daybecome interactive. Mercedes Benz prototypecars have already been conceived with theidea of having car stereos that allow driversto hit a “buy now” button and purchasethe song while driving. While this typeof technology is still speculative at best, itwould not fall into statutory licensingprovisions. Instead of paying licensing feesto the RIAA, when established, individuallicenses would need to be obtained androyalties would have to be paid to eachindividual copyright owner unless morechanges are made to the Copyright Act.

Although consumers love the fact that XMSatellite Radio offers them variety ratherthan stale, redundant radio programmingdictated by advertisers, there is nothinginteractive about XM; the control over theprogramming remains in the Washington,D.C. based studios. This makes XMcapable of obtaining licenses to bringmusic to listeners in an innovative way whileremaining within the digital performanceprovisions of the Copyright Act.

Leslie C. Adams (JD‘03) is from West PalmBeach, FL. She has aBS in Journalism fromthe University ofFlorida. She plans topractice IP law upongraduation.

SECURE DIGITAL MUSIC INITIATIVE (SDMI)BY LEON TYNES (JD ‘03)

THE “SWISS CHEESE” SOLUTION OF SDMI

CHASM OF MONUMENTAL PROPORTIONS has been created by the digitalmusic industry, pitting consumer against artist. During the Grammy Awards

program aired on February 27, 2002, the Recording Industry Association ofAmerica (RIAA) and the National Academy of Recording Arts and Sciences (NARAS)joined together to express its repugnance and anger over the downloading of “ripped”MP3 files from the Internet. The response from the audience, comprised primarily ofmusic industry professionals, was lukewarm at best. NARAS made the allegation thatartists that are new to the industry would suffer financially because consumers will divertprofits through free or low-cost downloads. Nevertheless, many artists have successfullysecured recording contracts and have received notoriety, critical acclaim and financialsuccess through offering their music via the Web. Also, record sales continue to increasedespite the popularity of peer file exchange over the Internet. In response to this dilemma,the Secure Digital Music Initiative (SDMI) was introduced in A&M Records v. Napster asthe solution to ensure compliance with copyright laws.

DESCRIPTION

Record labels ignored the emergence of compressed digital formats until the successfulrelease of the Diamond Rio MP3 Player during the Christmas season of 1998. Instead ofutilizing traditional business methods to gain control of digital music distribution andexchange, the labels panicked and initially sought to litigate. The SDMI is a forum of over160 companies and organizations whose unifying purpose is to develop technologyrequirements to protect copyrights, ensure royalties to artists and unite technology andrecord companies in developing standards to prevent unauthorized duplication anddistribution of music.

REQUIRED TECHNOLOGY

The SDMI proposes the utilization of encryption and watermarking as its forms of digitalmanagement technology to prevent abuses of copyrights. Encryption utilizes encodingfiles that require “keys” such as hardware serial numbers to access content. Watermarkingis a process whereby inaudible signatures are implanted into electronic media so thatSDMI compliant devices and software will be able to recognize their presence and controlduplication appropriately. Companies such as Muzak frequently used audible watermarksin the past, but the modern consumer market requires that the mark be inaudible toensure the artistic nature of the music.

The effectiveness of encryption and watermarking are severely impaired because currentsoftware and hardware devices lack the ability to query media to determine the legitimacyof a copy. Another major weakness of the SDMI proposal is the prominence of software“cracks” and “plug-ins” to circumvent or strip programs of their ability to authenticate copies.

SUPPLEMENTARY LEGISLATION

The SDMI was formed in the wake of several legislative attempts to strengthen copyrightlaws given and in response to the emergence of and increasing popularity of digitaltechnology and distribution. The first was the Audio Home Recording Act of 1992 (AHRA),which covers technologies such as digital audio cassette players, minidisc players anddigital audio tape players (DAT). The act specifies that manufacturers of such devicesmust register with the Copyright office, pay statutory royalties on devices and media, and

A

See SDMI, page 23


conflict between existing internationalagreements. The CBD and the TRIPS havebeen found to have contrasting effects onaccess to genetic resources and benefitsharing. Experts have suggested a revisionof parts of the TRIPS Agreement to allowthe exclusion or relaxation of standards ofintellectual property rights relating toenvironmentally sound technologies, andto technologies that relate to the use ofbiodiversity (Third National NetworkStatement to the 2nd meeting of the Panelof Experts on Access and Benefit Sharing,Montreal, 19-22 March 2001). However, itis becoming apparent that current measuresof the respective national authorities areinadequate to enable the implementationof benefit sharing and collaborationamong nations.

Thus, examination of the current legalframework is necessary to perform a usefulanalysis of the issue at hand. One mustidentify the nature of traditional knowledgeand its significance in traditional commu-nities, then examine the internationalinitiatives as well as the current agreementsto establish whether or not traditionalknowledge is adapted to modernintellectual property.

WHAT IS ENCOMPASSED INTRADITIONAL KNOWLEDGE?

According to WIPO, traditional knowledgemay be defined as a multifaceted conceptthat encompasses several components.What characterizes traditional knowledge isthe fact that, in general, it is not producedsystematically, but rather in response toindividual or collective creators’ needs andinteractions with their cultural environment.Traditional knowledge is “traditional” onlyto the extent that its creation and use arepart of the cultural traditions of communities.“Traditional” does not necessarily meanthat the knowledge is ancient. “Traditionalknowledge” is created every day and evolvesas to the needs of the community. In its usetraditional knowledge is a contemporaryknowledge (International Bureau of WIPO,Information Note on Traditional knowledge,Muscat, January 21 and 22, 2002).

For such reasons, existing intellectualproperty systems which traditionally favor

trade relationships may not fully respondto the essential nature of traditionalknowledge. Thus, holders of traditionalknowledge have increasingly complainedthat developed countries with little or nocompensation have appropriatedknowledge of traditional medicine.Pharmaceutical companies regularlyfinance expeditions into remote areas toexploit traditional knowledge geneticresources that can be used to developprofitable drugs. Such actions are legallyjustifiable under in the principles of theTRIPS Agreement. Advocates of developingcountries’ rights have argued that theTRIPS Agreement fails to protect tradi-tional knowledge against companiesseeking proprietary rights over collectiveknowledge for the sake of the private gain.As a result, TRIPS restricts and deniesdeveloping countries access to thetechnologies needed for their economicdevelopment and renders it difficult tocompete in the global economy. UnderTRIPS, there are no existing provisions forthe patent holder on claims involvingbiological resources or related knowledgeto share benefits with the state or com-munities of origin. In fact, the country oforigin has no resources to enforce itsbenefits sharing rights (as recognized byCBD) if a person or a company was toobtain a patent based on traditionalknowledge. Also, international patent lawas well as most domestic patent laws requirenovelty and inventive steps that are notapplicable to traditional knowledge andbiodiversity. As an illustration, there are noprotections under current patent laws formanual or spiritual therapies. Additionally,without a comprehensive database of allmedicinal plants used in various countriesand continents, it is very difficult to identifythe founder. As a result, the need for theimplementation of an adequate legal systemfor the protection of traditional knowledgehas become increasingly apparent.

INTERNATIONAL INITIATIVES ANDCURRENT AGREEMENTS

Currently, only three protectable subjectmatters qualify for a pharmaceuticalproducts patent under conventional patentlaw: patents for discovering new chemicalcomponents, patents for know-how inproducing products, and patents for the

trademark. Herbal medicine as defined byseveral World Health Organization (WHO)guidelines include crude plants such asleaves, flowers, fruits, and seeds. Therefore,products to which chemically definedactive substances have been added are notconsidered herbal medicine. Thus, it wouldbe impossible to obtain patent protectionfor herbal medicines through the discoveryof new chemical components.

At the request of its members’ states, theWIPO General Assembly (26th session,Geneva from September 25 to October 3,20000) established an intergovernmentalCommittee on Intellectual Property andGenetics Resources, Traditional Knowledgeand Folklore (the Committee”). With regardsto traditional knowledge, the members’ statesidentified four primary issues:

Terminological and conceptual issues. WIPOcurrently use the word traditionalknowledge to refer to tradition-basedliterary, artistic or scientific works;performances; inventions and creationsresulting from intellectual activity in theindustrial, scientific, literary or artisticfields. The current issues in regard totraditional knowledge include the selectionof appropriate terms to describe the subjectmatter for which the protection is sought;study of customary laws and regulatorysystems that apply to traditional knowledgein local and traditional communities.

Standards concerning the availability, scopeand use of intellectual property rights intraditional knowledge. Such issues include,facilitating the access to the intellectualproperty system to enable traditionalknowledge holders to acquire and useintellectual property rights available undercurrent standards. Additionally, in thelonger term, possible development of newstandards to protect traditional knowledgeunder current intellectual property tools.

Certain criteria for the application oftechnical elements of standards, namely legalcriteria for the definition of prior art andadministrative and procedural issues relatedto the examination of patents applications.

The enforcement of rights in traditionalknowledge. This involves facilitating access

KNOWLEDGE, from page 9

See KNOWLEDGE, page 17


to the intellectual property system, toenable traditional knowledge holdersto use and enforce rights under theintellectual property system. (WIPOGeneral Assembly, 26th Session, Geneva,September 25 to October 3, 2000)

In light of these issues, some countriessuch as India, Kenya and Madagascar havetaken important steps by updating theirlegal systems and national patent laws inorder to protect the knowledge of tradi-tional medicine. Taking in account thedivergence between traditional knowledgeholders, this article recommends theimplementation of a regional agencyunder the auspices of the WIPO. Suchagency will record customary laws andrelated cultural understandings relevantfor traditional knowledge protection, andestablish accordingly an intellectualproperty system that will recognize anduse customary laws to manage relation-ships with the traditional knowledgeholders. Furthermore, this agency wouldaddress the issue of collective acquisition,administration and enforcement ofintellectual property by traditionalknowledge holder’s associations. Suchassociations would acquire, exercise andenforce intellectual property rights onbehalf of the traditional knowledge holders.

CONCLUSION

It is inherently difficult to protect tradi-tional knowledge under modern intellectualproperty laws, which tends to favor indi-viduals as well as large companies. Taking inaccount the disparate treatment in the lawsof developing countries on one hand, andthose of developed nations on the other, thisarticle propose a regional solution instead ofan international one.

Annick Tchokonte(LLM ’02) hometownis Atlanta, Georgia.She received her JDin Business Law fromthe University of Paris,France. She plans topractice Trademark

and International Law.

STUDENT PORTRAIT: DESIRE (“DEZ”) RUBADIRIBY NANCY B. DELAIN (JD ‘03)

ESIRE (“DEZ”) RUBADIRI was born in England and obtained his elementaryeducation in the East African countries of Uganda and Kenya before moving

south to Botswana. He received his university education at the University ofBotswana, first earning a B.A in Humanities (English and African Literature, Language,History with a French minor), following this with an LL.B (the US J.D. equivalent). Hethen crossed the Atlantic to earn his LL.M. at the Washington College of Law, AmericanUniversity (AU) in Washington D.C.

At AU, he studied international trade, businesstransactions, international environmental law,international human rights and refugeeprotection, and intellectual property. He sayshis reason for this array of courses was to freehimself from the “territorial confines oftraditional legal practice,” giving him theability to practice as he does, as an inter-national legal adviser. His transnationaleducational background is apparent in histhinking and is further echoed in his publica-tions and presentations, including:

“Globalization, the WTO and The SouthernAfrican Development Community,” given at aRegional Workshop on Strengthening Africa’s Participation in the WTO in Nairobi, Kenya;

“A Long Walk to Freedom” presented in Addis Ababa, Ethiopia (1998);

“Africa’s Biosafety Who Cares?” presented in Harare, Zimbabwe (1999);

“Is Environmentally Sustainable Development an African Concern?” presented in Accra,Ghana (2000);

“Globalization the WTO, and SADC” presented in Nairobi, Kenya at a regional workshopon Strengthening Africa’s participation in the World Trade Organization organized byACTS/ IDRC (2000);

“Capacity building…What of the African International Trade Lawyer?” submitted forRegional Meeting on Research and Training Needs in International Trade in Africa, PortLouis, Mauritius 3-5 October 2001 organized by UNDP/UNCTAD/AERC;

“The TRIPS Agreement, Traditional knowledge, Genetic resources and Folklore- A HumanRights Perspective, a paper presented at the University of Venda for Science and Technol-ogy, Thohoyandu, 5-8th December 2001;

“An Introduction to the core principles of Environmental Law and Sustainable Develop-ment in respect of Transboundary Natural Resource Management presented at an IUCNWorkshop in Cape Town, S. Africa 12-13th December 2001 on Conflict Management andResolution in Transboundary Natural Resource Management.

Desire spreads his abilities between being an attorney, a notary public and conveyancerand an international law adviser, working on consultancies around a wide area of legalissues pertinent to Africa. His studies at Pierce Law as a student in the Diploma in

D

DESIRE RUBADIRI

See PORTRAIT, page 24

KNOWLEDGE, from page 16


GENERAL PERSONAL JURISDICTION

“General jurisdiction permits a court toexercise personal jurisdiction over a non-resident defendant for non-forum relatedactivities when the defendant has engagedin “systematic and continuous” activities inthe forum state. [citations omitted]” ZippoManufacturing v. Zippo Dot Com, 952F.Supp. 1119, 1122 (W.D.Pa.1997). The vastmajority of internet-based cases involve notgeneral, but specific, personal jurisdiction.

SPECIFIC PERSONAL JURISDICTION

“[S]pecific jurisdiction permits a court toexercise personal jurisdiction over a non-resident defendant for forum-relatedactivities where the “relationship betweenthe defendant and the forum falls withinthe ‘minimum contacts’ framework” ofInternational Shoe Co. v. Washington [ 326U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95(1945)].”

The U.S. Supreme Court noted in 1958 that“[a]s technological progress has increasedthe flow of commerce between States, theneed for jurisdiction has undergone asimilar increase.” Hanson v. Denckla, 357U.S. 235, 250-51 (1958). In 1985, some 27years later, the Court further held thatmuch modern business is conductedwithout either party entering the forum of

the other. Burger King Corp. v. Rudzewicz,471 U.S. 462, 476 (1985). The U.S. SupremeCourt has not heard a case specificallydealing with jurisdiction over the internet,but the Western District of Pennsylvania’sZippo Manufacturing decision presented a“sliding scale” analysis for determiningwhether personal jurisdiction in an internetcase comports with the 14th Amendmentrequirements of due process that is currentlyfollowed extensively. The Zippo court stated:

“[T]he likelihood that personaljurisdiction can be constitutionallyexercised is directly proportionate tothe nature and quality of commercialactivity that an entity conducts over theInternet. This sliding scale is consistentwith well-developed personaljurisdiction principles. At one end ofthe spectrum are situations where adefendant clearly does business overthe Internet. If the defendant entersinto contracts with residents of aforeign jurisdiction that involve theknowing and repeated transmission ofcomputer files over the Internet,personal jurisdiction is proper. E.g.CompuServe, Inc. v. Patterson, 89 F.3d1257 (6th Cir.1996) . At the oppositeend are situations where a defendanthas simply posted information on an

Internet Web site which is accessible tousers in foreign jurisdictions. A passiveWeb site that does little more thanmake information available to thosewho are interested in it is not groundsfor the exercise personal jurisdiction.E.g. Bensusan Restaurant Corp., v. King,937 F.Supp. 295 (S.D.N.Y.1996). Themiddle ground is occupied byinteractive Web sites where a user canexchange information with the hostcomputer. In these cases, the exerciseof jurisdiction is determined byexamining the level of interactivity andcommercial nature of the exchange ofinformation that occurs on the Website. E.g. Maritz, Inc. v. Cybergold, Inc.,947 F.Supp. 1328 (E.D.Mo.1996).”Zippo at 1124.

This test has been widely applied throughoutthe federal circuit courts. In the First Circuit,the District Court of New Hampshire(Barbadoro, CJ) found lack of personaljurisdiction based on the passive websitedeveloped and maintained by a hoteland accessible from the Internet in NewHampshire. Dagesse v. Plant Hotel N.V., 113F.Supp.2d 211 (D.N.H., 2000). The Third

JURISDICTION, from page 11

EX. 2: HAYDN – “ADAGIO” FROMSONATA NO. 62 IN E-FLAT, MEAS. 48,MANUSCRIPT

This is perplexing, because Haydn and hiscontemporaries were perfectionists. Asixteenth note at that position causes theentire measure to be short a quarter of abeat. When asked about this problem, myprofessors did the math, gave up, and toldme “Haydn must have slipped up andmissed a beat. It’s surprising that he evenwrote out the arpeggios anyway.” Iremained skeptical. In music from theClassical era (1750-1825), two plus twoalways equals four. There was often such“fuzzy math” during the Romantic era(1825-1900) when two plus two mightequal five, but not during the Classical era.I decided to investigate.

As it turns out, the Library of Congress hasthe original manuscript. While I was homein D.C. during Winter Break I requested tosee the manuscript and was in disbelief

when the music librarians brought it upfrom the stacks. They even allowed me toleaf through it as long as I wore plasticgloves. I placed the manuscript in front ofme and the Henle edition above it andproceeded to compare them measure-by-measure. Looking at measure 48 of themanuscript the beat was indeed filled by aneighth note. The eighth note mathematicallyfulfills the measure’s three beats (ex. 2) incontrast to the sixteenth note printed in myHenle edition.

Apparently, Longman & Broderip made afew errors in their haste to get the score topress. Modern publications still carry thenow 200-year old mistake. Though thisfinding is extremely minute and detail-oriented, it is nonetheless significant to me.This discovery built my confidence as amusic scholar, for I trusted my instincts andwas able to find the source of a problem thatwent unnoticed for over 200 years.

Elizabeth Hochbeg (JD‘03) is from Springfield,Virginia. She has a BSin Pre-Med/Chemistryand a MM in PianoPerformance and

Pedagogy from Kansas State University.She plans to practice IP law inWashington, D.C. upon graduation.

FUZZY MATH, from page 13

See JURSIDICTION, page 19


Circuit has said, “the mere posting ofinformation or advertisements on anInternet website does not confernationwide personal jurisdiction.” Remickv. Manfredy, 238 F.3d 248, 259, (E.D. Pa.,2001). The Fourth Circuit District Court(Chambers, J), in determining whether togrant personal jurisdiction in an internetcase, looked widely through the circuits tofind caselaw to uphold its decision. Itstated, “Most courts to consider the effectthat a defendant’s a website has on thatdefendant’s purposeful contacts with aforum state have adopted the “sliding scaleapproach” from Zippo Mfg. Co. v. ZippoDot Com, Inc., 952 F.Supp. 1119(W.D.Pa.1997). [citations omitted]” Jeffersv. Wal-Mart Stores, Inc., 152 F.Supp.2d 913(S.D.W.Va., 2001).

Many other federal courts in the U.S. havealso utilized the Zippo test. The FifthCircuit adopted it in Mink v. AAAA Dev.LLC, 190 F.3d 333, 336 (5th Cir., 1999),and the Ninth Circuit adopted it inCybersell, Inc. v. Cybersell, Inc., 130 F.3d414, 419 (9th Cir., 1997). District courtsin Maryland, South Carolina, and theEastern District of Virginia have alsoadopted the test.

CONCLUSION

The “sliding scale” analysis of ZippoManufacturing v. Zippo Dot Com hasgained wide popularity in the federalcircuit courts in the United States simplybecause it allows traditional personaljurisdiction to be applied to cases at thecutting edge of technology. The inter-national arena has yet to clearly decidehow countries outside the US will handlethe personal jurisdictional issues that willinevitably arise more and more as the internetbecomes more and more ubiquitous.

Nancy B. Delain (JD’03) is from New York.She has an AB inBiological Sciencesfrom Smith Collegeand a MS in TechnicalWriting from Renselaer

Polytechnic Institute. She plans to practiceIP law upon graduation.

COLOR ME CONFUSED, CONFOUNDED

From the Editor

ITH THE GROWING importance of Intellectual Property Rights (IPRs),evidenced by damage awards for infringement and annual royalty income

reaching 10-digit figures, “leveraging” and “monetizing” IPRs have becomebuzzwords. A veritable cottage industry of web-based third-party service providers hassprung up in short order to “extract value” from IPRs. The big five accounting firms,and Arthur Andersen, in particular, seem to have initiated and spearheaded the “newwave” or, I would say, “new craze.” To name but a few: Aurigin, Ascent Financial, Delphion,Epache, INTX, ipCapital Group, IP.com, IPNetwork.com, IP Vision, IP Value Management,Invention Machine, Licent Capital, M-Cann, PatEX, Pl-xTRRU, ThinkFire, Value Extraction,Yet2.com, etc.

Some of these outfits have generated a lot of hype and hoopla about producing“patents on demand” in “patent factories” and valuing a patent “in a matter of minutes.”

The example of TRRU (Technology Risk/Reward Unit) Metrics, which “adapts the sameNobel Prize winning equation (The Black-Scholes Formula) used in determining thevalue of call options,” because “a patent is a ‘call option’ on technology,” is especiallyinteresting and revealing. It is touted as providing “almost instant, market-driven calculation”of IP value. Ernst & Young is full of praise: “It used to take us weeks to provide a valuationestimate to a client. Now we can determine the value of a patent in several minutes andhave the security of knowing that its result is based on actual market data.” (Emphasisadded.) According to a stunned eyewitness of a demonstration, a light-flashing computerspewed out a figure in a few minutes, indeed—and a figure in the millions, of course. Andtheir software program is available for a “mere” $60,000. Is this snake-oil salesmanshipor what?!

Speakers at the Winter Meeting of the Association of Corporate Patent Counsel (ACPC)in Phoenix, Arizona last January had this to say: These service providers are much tooexpensive for what they deliver, they haven’t done much for companies using them, theyare “solutions in search of needs,” Aurigin already went belly-up and filed under Chapter11 (which makes “Rembrandts in the Attic,” published by Aurigin, of dubious relevance)and there are “other dead bodies” around. One speaker was “sheepish” (his term) abouthaving had a role in Arthur Andersen’s “Edison in the Boardroom.”

Can patents, as advertising of these outfits would want one to believe, be produced “ondemand” in “patent factories” and can their value be determined “in a matter of minutes?”Is the underlying premise correct that a patent is a patent is a patent and by definitionis a “Rembrandt in the Attic?” Does the patentee have the upper hand, by virtue of havinga valuable patent, and hence can he/she charge what the traffic will bear? Is licensing,selling or donating patents the best way to extract value? Is licensing-out the “only gamein town”? The answers to these questions are a resounding no for numerous reasons,which appear to be overlooked and ignored in this IP valuation and monetization hypeand hoopla. We need to remind ourselves therefore of the fundamentals of patent andlicensing law and practice.

1. First of all, there are many, what I call, attrition factors for patents, affecting theirincidence, validity and value, such as:

See CONFUSED, page 20

W

JURISDICTION, from page 18


• Creativity and inventiveness reaching thepatentability level (in terms of noveltyand unobviousness) are very rare qualities.Intellectual property cannot be treated asa “given.” (Professor Jay Dratler).

• Many R&D scientists and engineers, likeanalytical chemists, work in areas lessconducive to inventing.

• Patentable inventions are often overlookedbecause R&D staffs don’t “think patents,”being too preoccupied pursuing their R&Dprojects and believing that their develop-ments or improvements are not patentable.

• Corporations and institutions are quiteselective in choosing inventions for patentcoverage if they are not within the corpo-rate franchise and R&D plans and budgets,trade secret maintenance or defensivepublications are preferred, and a shortageof patent practitioners and high PTO feesmilitate against extensive filings.

• Patentability is doubtful due to closeprior art, statutory bars or other patent-defeating grounds.

• Inventorship and ownership problemscan raise their ugly heads.

• Patent applications are often narrowed inscope, finally rejected by the PTO, or loston appeals.

• Getting a patent and getting an enforceablepatent are two different things—a patentis a slender reed, threatened with threedozens of invalidity grounds.

• “Only about 5% of a large patent portfolio”have commercial value (Emmett Murtha),i.e. the rest are mere paper patents, andhence hardly licensable for big money.

• The average effective economic life ofa patent is “only about five years”(Emmett Murtha).

• Enforcing patents is a daunting andfrustrating as well as an expensive andtime-consuming task.

• For many patents, no or only limitedcoverage is obtained in foreign countries.

• Focusing on patents as measures of inno-vation or vehicles for technology transferignores the fact that they are often valuelessor inadequate for commercializing viable

CONFUSED, from page 19

products, absent associated, collateralknow-how protected by trade secrets.

2. In corporate and institutional settings,and because patents do not “grow on trees,”a more effective and reliable, promising andproven patent management practice to“harvest inventions” involves the followingelements and steps:

• A simple, easy Invention Disclosure system(policy, procedure and forms),

• Close rapport with inventors—“hand-holding,”

• A MBW practice (Management byWandering Around—Harvard BusinessReview),

• Periodic trips to R&D sites,

• Presentations on IPR topics to R&Dpersonnel to create IP awareness,

• Distribution of IP bulletins to R&Dpersonnel,

• Regular perusal of R&D’s technical reports,

• Attendance at R&D meetings,

• Written procedures for cooperationbetween R&D and IP Departments,

• Placement of patent liaison people atR&D sites,

• A reasonable employment/ inventionagreement with all R& D personnel,

• Review of invention disclosures in patentcommittee meetings,

• An inventor award or incentive system.

3. As regards the value of patents, there aremany factors or considerations that play animportant role in any valuation. Vastlydifferent values may reside in broad, basic orpioneering patents versus narrow improve-ment or picture patents, that it is easy to designaround. For competitive reasons, patentapplications are filed very early after con-ception and reduction to practice and hencehave little experimental support and covertechnology in a mere embryonic stage. Thatis entirely different from a patent that coversa successful commercial product or process.This goes also for paper patents. Moreover,there is a significant difference in valuebetween a patent that is strong and enforce-able and a patent that is weak and of

questionable enforceability. And of coursevalues may vary widely from industry toindustry. Also, in most patent transactions apackage of patents (issued patents, pendingapplications, rights to apply for patents) isthe merchandise, but the purchase price orroyalty is not cumulative. Furthermore, apatent that has been upheld in court as valid,will significantly gain in value. And rare ornon-existent in the advertisements andliterature of the valuation and monetizationservice providers, are references to theindispensable exercise of due diligence inIP transactions which may take weeks ormonths and without which one may “buya lawsuit” rather than an asset.

4. In a licensing context—and licensingout is what the value extraction andmonetization mania is all about—thevaluation or royalty-setting fundamentalscan likewise not be ignored.

Contrary to common assumptions andmisconceptions, it is not true that licensorscan charge what the traffic will bear, licensorscan recoup their R&D expenses, the cost ofthe development of a technology is a bigfactor, there are royalty standards withineach industry to go by, etc. Indeed, there isa limit to what a licensor can charge and mostoften it is the licensee’s economics, not thelicensor’s, that controls the royalty determi-nation (Gordon Smith). And isn’t there a25/75% rule? Isn’t licensee entitled to thelion’s share because of the greater risk he/she carries, especially with less-than-fullydeveloped technology? And above all, whenit comes to royalties less is more and greednever pays off. In my corporate experience,several agreements turned sour because theroyalties were too high, the profitability wasnot there and the deals could not besustained in the end. On several otheroccasions, agreements had to be renegotiatedfor lower royalties for the same reasons. Inother words, they were not viable win/winlicense agreements to begin with.

Actually, the cost to licensor of the devel-opment of the technology is not a factor at all.



The R&D costs of developing the technologyare sunken expenses expended by the patentee/licensor whether or not it is licensed and,therefore, should not be considered in arrivingat a suitable royalty. That is to say, the public’sinterest in buying a product is essentiallyunrelated to the cost of developing it (TomArnold, Martin Landis, Gordon Smith).

Anent royalty standards in industry and thefigures often being bandied about as industryaverages, John Romary called industryaverage royalty rates “folklore” and “suspectas a royalty-rate guide.” He pointed out, forexample, that “a 5% running royalty for anon-exclusive license helps very little inevaluating an exclusive license on different,but related technology and a 1.5% runningroyalty on technology that can be effectivelydesigned around is equally unavailing inpegging the value of a pioneer patent criticalto the competitor.”

However, Romary allows as how suchaverages, though expressed as ranges, mayprovide additional data points, and he listsfor consumer products 1-2%, chemicalsand electronics 1-5%, computers 3-5%,pharmaceuticals 4-15%, with an overallrange of less than 0.05% to over 20%. Healso states that these figures are based onthe net sales price of a non-exclusive licenseand that a “20 to 50 per cent premium” and“as much as a 300 per cent premium…inthe pharmaceutical field” may be a reasonableaverage for an exclusive license.

Furthermore, we should not lose sight ofTom Arnold’s “100 Factors Involved inPricing the Technology License,” tabulatedand discussed in the “1988 Licensing LawHandbook.” This is a handy checklist, eventhough not all factors play a role in a giventechnology license. He groups them underthe rubrics of intrinsic quality, protectionand threats of protection, values brought tothe table by the licensee, IP portfolios andmarkets, competitive, risk, legal and regulatoryconsiderations, and it is clear from hisdiscussion that among the most importantand weighty factors are: a) the stage ofdevelopment of the subject technology

(embryonic, early stage and untested v.tested and commercial); b) the strengthof the IPRs (solid v. weak, easy to designaround vel non); and c) the degree ofexclusivity (exclusive v. non-exclusive).

Even in patent infringement litigation, thecourts are guided in the damages phase bymany factors that would have been consideredrelevant by the parties in a “hypotheticallicense negotiation.” Witness the 15 Georgia-Pacific and 17 Honeywell/Minolta factors.

And the fact that many other operativeclauses in a technology license have economicweight, as for example, payment structuresand schedules, most-favored-licenseeclauses, representations and warranties, etc.(according to Gordon Smith), needs to bekept in mind, so that royalty setting is notthe first task in licensing negotiations butthe last one, one to be tackled only after allthe terms have fallen into place.

And would IP valuation and monetizationgurus ever contemplate a royalty-free licensethat in my experience can also be muchmore beneficial and profitable in terms ofgoodwill and increased rate of purchasingof supplies and goods than exacting paltryroyalties under a patent license?

5. As stated above, preachers of the gospelof value extraction and monetization focuson licensing IPRs for obvious reasons, over-looking however that much, much greatergains and profits can be achieved by protectionof, and exclusivity for, a company’s productsand processes. Exploitation of IPRs throughmanufacturing and sales can be much morebeneficial and lucrative than licensing-out.

Market exclusivity under IP protection is byfar the primary and most important objectivefor all but a few of the biggest corporations.Entrepreneurs, start-ups, small and middle-sized companies would not last very longabsent IP protection and market exclusivity.That is to say, such companies are completelydependent on IPRs for their technologiesfor continued survival in the market place.Licensing their IPRs would set up competitorsand this is a valid reason behind the generalreluctance to license-out. And pharmaceutical

and biotech companies need IPRs and marketexclusivity to protect their enormous R&Dinvestments. A recent survey in the UKrevealed that 80% of pharmaceuticalcompanies and 88% of technology companiesthink that protecting their products againstcompetition is vital and this reinforced thefact that patent protection lies at the heartof the development of new drugs andtechnologies (Marks and Clerk Newsletter,No. 1, 2002). Undoubtedly this is likewisetrue elsewhere.

As is well known, licensing normally carrieslittle risk but also little reward. Royalty incomeat prevailing rates amount to at best a smallpercentage of net sales of licensed product,while markups on products sold under IPprotection and market exclusivity could bemuch, much higher, by multiples, and mayeven reach a 1000% or more. And this isanother reason for the innate reluctance tolicense-out IPRs. Interestingly, 97% of allpatents are not licensed for this reason orbecause the technology they cover is notuseful, feasible or marketable (EmmettMurtha).

6. The value extraction and monetizationadvocates can also be faulted for not factoringtrade secrets into their calculations. Over90% of all new technology is covered bytrade secrets and over 80% of all licenseand technology transfer agreements coverproprietary know-how, i.e. trade secrets, orconstitute hybrid agreements relating topatents and trade secrets.

As a practical matter, licenses under patentswithout access to associated, collateralknow-how are often not enough to usepatented technology, because patents rarelydisclose the ultimate scaled-up commercialembodiments of products and processes.According to Homer Blair, “in many cases,particularly in chemical technology, theknow-how is the most important part of atechnology transfer agreement.”




And Robert Ebish advises: “Acquire not justthe patents but the rights to the know-how.Access to experts and records, lab notebooks,and reports on pilot-scale operations,including data on markets and potentialusers of the technology are crucial.” This isgood advice because very few patents coverfully developed technology and hence areeasily licensable. Moreover, according toMelvin Jager, “Trade secrets are a componentof almost every technology license…(and)can increase the value of a license…up to 3to 10 times the value of the deal if no tradesecrets are involved.”

Yet it is even harder to value trade secrets, sinceit is difficult, if not impossible, to know whenor if such a trade secret will be destroyed.

In this context it should be bemoaned thatthere is an unfortunate and unhelpfulmisconception about the interface betweenpatents and trade secrets. Many a talk hasbeen given at LES and other programsabout the choice of patents versus tradesecrets. For example, the series of LESTechnology Transfer Seminars deal, interalia, with the question: “When should Iapply for a patent versus trade secretprotection?” But patent and trade secrets arenot incompatible and mutually exclusivebut actually highly complementary and

mutually reinforcing; in fact, they dovetailand can be integrated for optimal protectionof innovation. There is no need to choosebetween them; notwithstanding the bestmode and enablement requirements.

Patents can protect significant productinventions and trade secrets can covervolumes of associated, collateral know-howthat does not belong in a patent specifi-cation and/or was developed after filingand can serve as a fall back position.Witness the recent decision in C&F Packingv. Pizza Hut, where the C&F patents on amanufacturing process for pizza sausagetoppings were held invalid on summaryjudgement on on-sale bar grounds but theirtrade secrets on this process were heldenforceable after trial and Pizza Hut had topay $10.9 million for misappropriation.

7. IBM’s and TI’s royalty stream in excessof $1 billion annually under their openlicensing policies is frequently held up as anexample of how successful licensing can be.IBM, as is well known, was forced into openlicensing by a consent decree with the JusticeDepartment. I submit however that theseare special cases that don’t apply to entre-preneurs, start-ups, middle-sized companiesand the biotech, chemical and pharmaceuticalindustries that are rooted in the empirical

sciences, where a “patent factory” approachwith invention disclosure output “on demand”and subsequent constructive reduction topractice by filing is not possible. Months andyears of experimental work may be requiredin these industries and often conceptiondoesn’t exist until reduction to practice isaccomplished, both being then simultaneous.

The value extraction outfits complain, andthereby rationalize their existence, that“business decisions end up being made bypatent attorneys who may not understandthe long-term commercial ramifications.”However, what is really deplorable is thatthese outfits ignore the fundamentals ofpatent licensing law and practice.

Reprise: Color me confused, confounded—but also very dubious, incredulousand skeptical!


@V I S I T P I E R C E L AW ’ S I P M A L L

www.ipmall.piercelaw.edu

“One of the internet’s best sites devoted to intellectual property.”

—The Internet Lawyer

Karl F. JordaDavid Rines Professor ofIntellectual Property &Industrial Innovation;Director, Kenneth J.Germeshausen Centerfor the Law of Innovation& Entrepreneurship,Pierce Law, Concord, NH


apply copyright management technologyto prevent reproduction. The DigitalPerformance Right in Sound RecordingsAct of 1995 (DPRA) followed conferringrights of copyright owners to authorize thedigital transmission of their works. TheDigital Millennium Copyright Act of 1996(DMCA) prohibits the distribution andmanufacture of electronic equipmentdesigned to circumvent technology whosepurpose is to protect duplication ofcopyrighted works. Most recently, the NoElectronic Theft Law (NET Act) states thatsound recording infringements may becriminally prosecuted regardless of thematriculation of profits or commercial gain.

INDUSTRY CRITICISM

Dr. Leonardo Chiariglione, executivedirector of the SDMI, challenged an articleby technology correspondent Eric Scheirerin November of 1999 that spawned masscriticism of the organization. Technologyjournalists believe that membership to theSDMI was accepted under duress in orderto avoid costly litigation threatened by thewell funded major label conglomerate if themanufacturers failed to comply. In addition,many analysts believe that the companiesinvolved are determined to pull out ofSDMI once the anti-piracy measures areinstituted. As time goes by, the surmountingdues become nothing more than a tempo-rary insurance policy for the companiesinvolved. To delay litigation, these softwareand hardware manufacturers compliedwith the group’s demands, knowing anysecurity standards would take time to buildand then be ratified among the member-ship. In the meantime, pre-securityenabled units continued to be manufacturedand distributed.

RECENT DEVELOPMENTS

The SDMI made the mistake of devising acontest whereby the general Net populationwas invited to “hack” into the recordingindustry’s watermarking system and win$10,000. On October 12, 2000, Salon.Comreported that the SDMI’s security systemhad been breached. A spokesperson for

SDMI denied the reports, but according tosources, not one watermark resisted attack.

Dr. Chiariglione has since resigned from hisposition with the SDMI, and their websiteis no longer available. As he tapers hisresponsibilities, the SDMI is actively seekinga replacement. In the interim, the groupcontinues to fall apart with more defectionapproaching. Recently, the leading manu-facturer of processor chips for MP3 playerssevered ties with the organization.

APPARENT WEAKNESSES

The weaknesses of the SDMI system arecommonplace within the technological andconsumer markets. MP3Musicwire.net hasreported the demise of the SDMI’s efforts,and Business 2.0 continually predicts thefailure of record company funded paydigital services such as Pressplay andMusicNet. In the Felten v. RIAA case,Professor Felten wanted to publish SDMIweaknesses at a USENIX conference, butthe RIAA threatened litigation under theDMCA to silence him. However, competitiveservices such as Morpheus, Audiogalaxy andLimeWire continue to popularize peer-to-peer music services despite Napster’scentralized server configuration.

STRATEGIC POSITIONING

No major labels have devised a proactiveapproach in planning for the future ofdigital music transmission and exchange.One of the major players, Sony, has investeda substantial portion of its research anddevelopment budget on its MP3 basedtechnologies such as the CLIÉ PDA and theportable MiniDisc with downloadingcapabilities. Sony’s latent promotion of theuse and conversion of digital audio formatsis a contradiction to their collective effortsto aggressively restrict the reliance on thetechnology. America Online has only recentlybecome a major player in the RIAA becauseof its merger with Time/Warner. Withcombined efforts between its businessunits, AOL could seamlessly configure MP3capabilities within its user interface bydeveloping a business model that provides

for the accounting of digital exchangeamong its millions of subscribers.

A progressive record company will defy theRIAA conglomerate and offer consumersMP3 files within the compact disc or as adownload option. Computers, portablecompact disc players, DVD players, and carstereos are examples of devices available toconsumers to decode the compressedformat. Record companies may have tooffer the “pure” version of the music files tothe consumers and let the chips fall wherethey may. If they successfully embed theiridentification through the utilization of adigital watermark or signature, the trans-mission and exchange will be traceable inthe future.

CONCLUSION

Although the SDMI’s efforts appear to bedoomed, similar methods and programsare sure to develop in a desperate andreactive attempt to prevent copying. Musicduplication has flourished since theintroduction of consumer reel to reel taperecorders; however, cassette tapes anddigital formats have only made the processmore convenient and portable. In order forrecord companies to gain control of musicfile exchanges, they must create synergieswith programmers, enhance their offeringsto consumers, and offer incentives to complywith duplication restrictions.

Leon Tynes (JD ’03) isfrom Oakland, CA. Hehas a BM in music fromthe University ofMemphis and a MBA inMarketing and E-

commerce from JFK University. He willpursue a career in the Music and MediaIndustry upon graduation.

SDMI, from page 15


FRANKLIN PIERCE LAW CENTER

TWO WHITE STREET CONCORD, NH 03301

NON-PROFIT ORG.US POSTAGEP A I DPERMIT NO 749CONCORD, NH 03301

PORTRAIT, from page 17

Intellectual Property program is very mucha part of his drive to equip himself with thebest education possible for his chosen areaof service. His course selection at PierceLaw includes International ComparativeCopyright and Trademark Law, SecuritiesRegulation, Law and Biotechnology,Trademark and Deceptive Practices, Law ofMotion Pictures, and an independent studywith Professor Bill Henessey in traditionalknowledge, genetic resources and folklore.This independent study concentrates in thearea, which is the next frontier in globalinternational intellectual property. He

believes that with Pierce Law’s reputationin intellectual property, it should be amongthe first law schools in the world to offersuch a course.

Desire is a member of the Botswana LawSociety, the Southern African DevelopmentCommunity Law Association, the AfricanSociety of International and ComparativeLawyers and is Legal Consultant for AU inSouthern Africa. He resides in Botswanawith his wife and four children. Asked whathe thinks of the winter in Concord he says,“it is good for the books.” We wish him well

in his studies and work at and beyondPierce Law.

Nancy B. Delain (JD’03) is from New York.She has an AB inBiological Sciences fromSmith College and a MSin Technical Writingfrom Renselaer

Polytechnic Institute. She plans to practiceIP law upon graduation.

FRANKLIN PIERCE LAW CENTER GERMESHAUSEN · PDF fileGERD F. KUNZE “THE FATHER OF THE ......

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