Capitalizing On Innovation: The Case of Japan
Source: Harvard Business School Working Papers

Japan’s industrial landscape is characterized by hierarchical forms of industry organization, which are increasingly inadequate in modern sectors, where innovation relies on platforms and horizontal ecosystems of firms producing complementary products. Using three case studies—software, animation and mobile telephony—we illustrate two key sources of inefficiencies that this mismatch can create. First, hierarchical industry organizations can “lock out” certain types of innovation indefinitely by perpetuating established business practices. Second, even when the vertical hierarchies produce highly innovative sectors in the domestic market, the exclusively domestic orientation of the “hierarchical industry leaders” can entail large missed opportunities for other members of the ecosystem, who are unable to fully exploit their potential in global markets. We argue that Japan has to adopt several key legislative measures in order to address these inefficiencies and capitalize on its innovation: strengthening antitrust and intellectual property rights enforcement; improving the legal infrastructure (e.g. producing more business law attorneys); lowering barriers to entry for foreign investment and facilitating the development of the venture capital sector.

+ Full Paper (PDF; 286 KB)

File-Sharing and Copyright (PDF; 358 KB)
Source: Harvard Business School Working Papers

The advent of file sharing has considerably weakened effective copyright protection. Today, more than 60% of Internet traffic consists of consumers sharing music, movies, books, and games. Yet, despite the popularity of the new technology, file sharing has not undermined the incentives of authors to produce new works. We argue that the effect of file sharing has been muted for three reasons: First, the cannibalization of sales that is due to file sharing is more modest than many observers assume. Empirical work suggests that in music, no more than 20% of the recent decline in sales is due to sharing. Second, file sharing increases the demand for complements to protected works, raising, for instance, the demand for concerts and concert prices. The sale of more expensive complements has added to artists’ incomes. Third, in many creative industries, monetary incentives play a reduced role in motivating authors to remain creative. Data on the supply of new works are consistent with the argument that file sharing did not discourage authors and publishers. Since the advent of file sharing, the production of music, books, and movies has increased sharply.

From the FJC Web Site:

A comprehensive, user-friendly, and practical judicial guide for managing patent cases. Although similar in many respects to other forms of complex civil litigation, patent cases pose distinctive case management challenges, including complex and dynamic technological facts to a degree rarely encountered in most other areas of litigation, and unique procedures (such as claim construction hearings) that affect and interact with other aspects of the case (such as summary judgment motions and expert reports). In addition, patent cases often entail distinctive and difficult discovery issues, extensive use of experts, and particularly complex dispositive and pretrial motion practice. The authors surveyed federal judges and describe their approaches and best practices for these and other aspects of patent case management.

Direct to Full Text Document (542 pages; PDF)

Note: This is a draft version of the . A completed version of the guide is forthcoming.

Source: Federal Judicial Center

From the Web Site:

Anatomy of a Patent Case is a concise, narrative summary of the steps required to bring a patent case to trial and of the key elements of such litigation.The central objective of the manual is to inform judges and lawyers not familiar with patent litigation of commonly used practices in this area of the law, and to offer suggestions as to how judges and lawyers may deal with some of the procedural problems presented in patent litigation. This handbook was prepared by the Complex Litigation Committee of the American College of Trial lawyers.

Direct to Full Text (154 pages; PDF)

Source: Federal Judicial Center

Government Still Blocking Information on Secret IP Enforcement Treaty
Source: Public Knowledge/Electronic Frontier Foundation

wo public interest groups today called on the government to stop blocking the release of information about a secret intellectual property trade agreement with broad implications for privacy and innovation around the world.

The Electronic Frontier Foundation (EFF) and Public Knowledge said that the April 30th release of 36 pages of material by the United States Trade Representative (USTR) was the second time the government had the opportunity to provide some public insight into the Anti-Counterfeiting Trade Agreement (ACTA), but declined to do so. More than a thousand pages of material about ACTA are still being withheld, despite the Obama administration’s promises to run a more open government.

+ FOIA: Anti-Counterfeiting Trade Agreement (ACTA), All Documents Released Under FOIA (PDFs)
+ Anti-Counterfeiting Trade Agreement

USTR Releases 2009 Special 301 Report
Source: Office of the U.S. Trade Representative (USTR)

The Office of the U.S. Trade Representative (USTR) today released its annual “Special 301” Report on the adequacy and effectiveness of intellectual property rights (IPR) protection by U.S. trading partners.
…
Significant developments in this year’s Special 301 Report include the following:

• Canada is being elevated to the Priority Watch List for the first time, reflecting increasing concern about the continuing need for copyright reform, as well as continuing concern about weak border enforcement.
• USTR is also elevating Algeria and Indonesia to the Priority Watch List, reflecting growing concern about the IPR situation in those countries.
• Korea is being removed from the Watch List in recognition of the significant improvements it has made during the past year, and the Korean Government’s policy direction of continuing to place a priority on improving its IPR regime. This marks the first time in the history of the report that Korea has not appeared on either the Watch List or the Priority Watch List. USTR will, however, continue to monitor closely the ongoing problem of Internet piracy in Korea, and will be prepared to consider returning Korea to the Watch List in the future if it does not respond effectively to this challenge through its implementation of newly enacted legislation and other steps.
• Again this year, USTR’s Special 301 Report highlights the prominence of IPR concerns with respect to China and Russia, despite some evidence of improvement in both countries….

+ Full Report

The Office of U.S. Trade Representative Releases Summary of Anti-Counterfeiting Trade Agreement (ACTA) Negotiations
Source: Office of the U.S. Trade Representative

The Office of the U.S. Trade Representative (USTR) today released a detailed summary of the current state of the Anti-Counterfeiting Trade Agreement (ACTA) negotiations. The summary, which all of the ACTA negotiating partners drafted, sets out the specific topics under discussion in the negotiations, and reflects the Obama Administration’s commitment to transparency. The summary is being shared with stakeholders for review and comment.

+ Full Document (PDF; 105 KB)

Innovation in Small Businesses: Drivers of Change and Value (PDF; 187 KB)
Source: U.S. Small Business Administration, Office of Advocacy
From e-mail:

The Office of Advocacy has funded several studies examining the patent activity of small businesses. All show that small businesses outperform their larger counterparts in patent activity (issuance). “Innovation in Small Business: Drivers of Change and Value” is another installment in this discussion. It widens the scope of the existing debate by focusing on the effects of drivers of innovation (employee headcount, sales, and R&D expenditures) on small business value.

+ Research Summary (PDF; 99 KB)
+ Fact Sheet (PDF; 27 KB)

Patents Not Responsible for “Knowledge Gap”
Source: Progress & Freedom Foundation

Strong patent rights are not responsible for a so-called knowledge gap between developed and developing countries, explains Sidney Rosenzweig in “The False Connection Between Strong Patent Rights and Global Inequity,” (PDF; 204 KB) released today by The Progress & Freedom Foundation. In the paper, Rosenzweig, PFF Visiting Fellow, refutes certain critiques of the U.S. patent system, which he describes as anecdotal and misrepresentative.

Rosenzweig focuses in particular on the anti-patent writings and speeches of Joseph Stiglitz, the Nobel-Prize winning economist at Columbia University. Contrary to assertions that patents restrict the dissemination of information and contribute to a “knowledge gap,” Rosenzweig explains that knowledge is disseminated through patent disclosure. The author counters claims that researchers principally seek status, as opposed to profits, from their work. In addition, Rosenzweig denies that patent strong patent rights breed anti-competitive conduct, stating that anti-competitive concerns should be addressed through antitrust and consumer protection law, not through reform of intellectual property rights.

Organized Crime Is Increasingly Active in Film Piracy; Three Cases Link Terrorists to Piracy Profits
Source: RAND Corporation

Organized crime increasingly is involved in the piracy of feature films, with syndicates active along the entire supply chain from manufacture to street sales of pirated movies, according to a new RAND Corporation report.

While crime syndicates have added piracy to criminal portfolios that include drugs, money laundering, extortion and human smuggling, the profits from film piracy also have been used on occasion to support the activities of terrorist groups, according to researchers.

“Given the enormous profit margins, it’s no surprise that organized crime has moved into film piracy,” said Greg Treverton, the report’s lead author and director of the Center for Global Risk and Security at RAND, a nonprofit research organization. “The profits are high and penalties for being caught are relatively low.”

RAND researchers found no evidence terrorists are widely involved with film piracy, but they outline three cases where film piracy supported terror groups and warn that such connections could grow in the future.

“If you buy pirated DVDs, there is a good chance that at least part of the money will go to organized crime and those proceeds fund more-dangerous criminal activities, possibly terrorism,” Treverton said.

+ Film Piracy, Organized Crime, and Terrorism

Patent Venue Reform Proposals Flawed
Source: Progress & Freedom Foundation

Patent venue reforms considered by the last Congress are vague and subjective, which could result in confusion and excessive litigation, explains Sidney Rosenzweig in, “Patent Venue Reform: Congress Takes Two Steps Back,” a Progress on Point released today by The Progress & Freedom Foundation. Rosenzweig proposes simplified legislative language to address forum-shopping issues in patent litigation. Congress is likely to revisit patent venue reform soon.

In the paper, Rosenzweig, PFF Visiting Fellow, identifies numerous deficiencies in the House and Senate bills. “Congress’s proposals are meant to prevent plaintiffs from choosing advantageous fora in which to bring suit,” Rosenzweig explains. “But the proposals are vaguely written and contain substantial gaps that will ensure that some cases cannot be brought in any venue. The effect of the enactment of either bill will be to cause a tidal wave of venue-related disputes to drown the federal courts.”

+ Full Report (PDF; 147 KB)

Public Knowledge Testifies Congress Should Streamline Satellite and Cable Copyright Laws
Source: Public Knowledge

Public Knowledge President Gigi B. Sohn today suggested to a House subcommittee a series of changes to copyright law that would promote competition and do away with an antiquated series of rules that no longer make sense with today’s technology.

In testimony to the House Communications, Technology and the Internet Subcommittee, Sohn said that the legal framework governing how cable and satellite TV services offer their programming is a patchwork of laws and regulations that unnecessarily differentiates between types of providers, restricts the availability of content to consumers, and sets the stage for discriminatory pricing.”

Sohn suggested replacing the current structure with one that would have cable and satellite follow the same rules for obtaining licenses to use copyrighted works, for broadcasting signals into local markets and for paying copyright royalty rates. In addition, Sohn said, services that carry video over the Internet could also be included in the unified regulatory structure.

+ Written Testimony
+ Oral Testimony

From the News Release:

…this report explores recent activities at each of the world’s major patenting authorities (USA, Europe, Japan, China and India).

Key findings from the 2009 Patent Focus Report include:
• For the first time a Chinese company, Huawei Technologies Co Ltd, topped the list of Patent Co-operation Treaty applications.
• The European Patent Office received 140,700 applications in 2007, up over 3% from the year before. In contrast, the number of patents granted fell from 62,800 in 2006 to 54,700 in 2008.
• The number of patent examiners in India has remained relatively static – raising questions about the quality of patents coming out of the Indian IP Office. In response, at the end of 2008 India announced 414 new examiner posts to be created by 2012.
• For the second year in a row, the Japan Patent Office reported the lowest level of approved patent applications since the mid-1990s.
• Patent approval rates at the US Patent and Trademark Office continue to fall to below 50% of applications examined.

Direct to Complete Report

Source: Thomson Reuters

Direct to Full Text (33 pages; PDF)

Source: Pierce Law School / International Technology Transfer Institute

From the Web Site:

A guide for managing patent cases for judges, law clerks, practitioners, and patent and civil procedure professors and scholars.

Direct to Complete Guide (542 pages; PDF)

Source: Federal Judicial Center