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Monthly Archives: May 2017

Unevenly Cooked: Raw Materials and Fair Use

Andrew Gilden, Raw Materials and the Creative Process, 104 Geo. L.J. 355 (2016).

Over the past decade or two, intellectual property scholars have learned to pay attention to the rhetoric that people use when arguing and advocating. In particular, many scholars have challenged the use of property rhetoric about “owning” and “stealing” by those seeking expanded IP protection. According to these scholars, this rhetoric has the potential to pump inappropriate moral intuitions and to distort the utilitarian analysis that is supposed to guide IP policymaking.

Andrew Gilden’s recent article shares this interest in the language of IP, but he trains his sights instead on the rhetoric used by those seeking to limit the scope of copyright protection and to expand fair use. Although Gilden is, I think, sympathetic with their project, he demonstrates how one metaphor—whether the plaintiff’s work was used as “raw material” in the defendant’s work—can have pernicious effects on the kinds of artists that are insulated by fair use law.

Gilden begins by establishing the descriptive analytic claim that courts and scholars have adopted a “raw-material framework” for determining whether the defendant’s use of the plaintiff’s work constitutes fair use in copyright law. Gilden also discusses the raw material metaphor in right-of-publicity cases, but I will focus on the copyright cases. According to the logic of the metaphor, the defendant’s work should be protected by fair use when he uses the plaintiff’s work as merely raw material for his own creativity. For example, Patrick Cariou’s photographs of Jamaican men are figured as merely raw materials in Richard Prince’s Canal Zone collages, no different than paint or charcoal.

Gilden traces the raw materials metaphor to Judge Pierre Leval’s Harvard Law Review article on transformative use, and he tracks its implementation by a range of different courts and scholars. They use the metaphor to “emphasize the costs that copyright imposes on future cultural participants” and to “underscore that creative works are not just goods: they are resources.” (P. 364.) In doing so, the raw materials framework seems to have liberalized the fair use doctrine by excusing defendants even when they were not targeting plaintiffs’ works with criticism or commentary.

Although Gilden seems to support the general direction that the raw materials framework takes us, he argues that this rhetoric has troubling normative implications. According to Gilden’s analysis of the cases, whether the defendant is using the plaintiff’s work as raw material seems to depend largely on the status of the parties. Jeff Koons and Richard Prince can successfully employ the metaphor in their defense, but the street artist Thierry Guetta (a.k.a. Mr. Brainwash) was found liable for copyright infringement for manipulating photographs of the Sex Pistols’ Sid Vicious. According to the court, the defendant’s artworks “remain at their core pictures of Sid Vicious.”

Conversely, high-status plaintiffs and artworks incorporating images of high-status people seem better able to defeat raw materials claims than do those of lower status. The works of J. K. Rowling, the creators of Seinfeld, and the photographer of the above-mentioned Sex Pistols’ bassist were not treated as raw materials, while works of lower-status artists and the bodies of women and racial minorities can be appropriated as raw materials in others’ works. In Prince, for example, the court highlighted the vast differences in market prices for the two artists’ works, and it described the Jamaican man in one of the plaintiff’s photographs as “a human being in his natural habitat.”

The raw materials framework does more than reward high-status artists at the expense of low-status artists, according to Gilden. It also obscures an important aspect of the creative process. The raw materials approach validates subsequent works that either criticize those that come before or entirely sideline prior works’ creative cultural value. As Gilden argues, however, the latter is rarely, if ever, the case, even for works by Koons and Prince. Despite these artists’ assertions during litigation, their choices of which works to appropriate were based on the expressive and social significance of those works.

Gilden’s solution to the distortions caused by the raw materials framework is not to abandon it entirely, but rather to supplement its application to fair use law with a richer understanding of the defendant’s creative process. Instead of focusing on the social value that emerges from defendants’ activities (something that is likely to be skewed by the factors discussed above), courts should “give greater attention to the subjective experience of creation.” (P. 398.) Thus, the first fair use factor should favor the defendant whenever she “uses the work…as a bona fide aspect” of her creative process. (P. 396.) Doing so, Gilden suggests, will generate a less biased and more realistic account of the nature of sequential creativity.

Gilden’s article recognizes an important aspect of contemporary fair use rhetoric, and he demonstrates its distributive effects without insisting that those effects will always arise. Finally, Gilden proposes a solution to this difficulty, and he explores the solution’s limitations. He has produced a thoughtful article that I like lots.

Cite as: Christopher J. Buccafusco, Unevenly Cooked: Raw Materials and Fair Use, JOTWELL (May 26, 2017) (reviewing Andrew Gilden, Raw Materials and the Creative Process, 104 Geo. L.J. 355 (2016)),

Do Patents Work?

Heidi L. Williams, How Do Patents Affect Research Investments?, Ann. Rev. Econ. (forthcoming), available at NBER.

As everyone who has taken a patent law course knows, the reason we have patents is to increase private incentives for knowledge production. But do patents actually work? Based on her review of the existing evidence, MIT economist (and MacArthur “genius”) Heidi Williams isn’t sure; she concludes that “we still have essentially no credible empirical evidence on the seemingly simple question of whether stronger patent rights—either longer patent terms or broader patent rights—encourage research investments.”

This bottom line will not be a surprise to those who have followed the empirical literature, but Williams’s careful identification and modeling of the relevant empirical parameters and her discussion of the most relevant evidence on each point makes her review a must-read for anyone interested in patent policy.

To understand how patents affect research investments, Williams argues that we must understand (1) the effect of patents’ disclosure function; (2) the ex ante effect of strengthening patent rights; and (3) the ex post effect of patents on existing technologies. As an illustration, consider some concrete invention—say, a method of treating cancer with a protein-based drug.

Williams’s parameters translate into three questions: First, do patent law’s disclosure requirements either make patenting less attractive or increase investment by making more information available to stimulate new research ideas? Second, does the prospect of a patent stimulate investment in finding this cancer treatment method, and how does this incentive vary as the patent right is made stronger or weaker (through changes to term or breadth)? Third, how is this incentive affected by patents on existing technologies, such as on the protein or the gene encoding it? (And how do the answers to these three questions change if our example innovation switches to a new battery or Wi-Fi protocol?)

There is relatively little evidence on the disclosure function of patents. Survey results indicate that firms sometimes choose not to patent because of the disclosure requirement and that at least some researchers do find useful technical information in the patent literature. Perhaps most interestingly, a couple of papers have looked at a U.S. policy change that caused applications filed after November 2000 to be automatically published after eighteen months unless the applicant was filing in only the United States and opted out of publication; they found that only fifteen percent of applicants who could opt out actually did (suggesting that there may be private benefits to disclosure) and that this earlier disclosure leads to earlier licensing of biomedical patents. But Williams is not aware of any work that has attempted to quantify the effect of disclosure on research investments.

On the second question, the ex ante incentive effect of stronger patent rights, there is again survey evidence, though it is useful primarily for indicating that the pharmaceutical and chemical industries value patent protection much more than other industries. To empirically estimate the relationship between patent strength and research investments, some researchers have looked at the impact of national patent law changes and found little effect. But one would expect such studies to understate patents’ impact: increasing protection in a small economy will not noticeably increase innovation in that economy if domestic firms were already innovating for the global market.

More promisingly, in work with Eric Budish and Ben Roin, Williams has taken advantage of variation in effective patent term for cancer treatments (given variations in the length of clinical trials) to find an R&D investment distortion away from projects with shorter effective patent protection, although they are not able to isolate the effect of patents compared with other factors (such as the increased cost of longer clinical trials). And even if longer patents are shown to increase research investments for therapeutics, this effect may not be generalizable to other industries.

Researchers have made the most progress on the third parameter—the impact of existing patents on follow-on technologies—for which one might expect either a positive effect (due to efficient coordination of follow-on research by the initial rightsholder) or a negative effect (due to transaction costs in licensing agreements).

In the biomedical context, evidence from survey results and some clever instrumental variables studies of patent applications on human genes and patents invalidated in court have suggested that upstream patents have little effective (positive or negative) on the quantity of downstream innovation. But invalidation of patents in fields such as computing and electronics appears to increase the number of innovators subsequently citing that patent.

The bottom line is that despite the vast number of empirical patent studies—Williams notes the 3000 citations to a foundational patent-citation paper—very few studies have convincingly tackled the causal link between patent policy and research investments.

One of the main problems has been the push toward centralization and global harmonization, since empirical progress depends on policy variation, whether across time, across jurisdictions, or across similar technologies. In the absence of greater real-world variation (natural or intentional), laboratory experiments can play an important role, and there is a growing body of qualitative work on patent incentives (although drawing inferences from qualitative work can be challenging).

I hope Williams and other empiricists will also continue to discover sources of effective variation, as with the study of cancer drugs needing different clinical trial lengths. Although it may be depressing for patent law scholars to realize how far we remain from answering the foundational question of our field, Williams’s review is an important reminder of what parameters are needed, what the most promising approaches so far have been, and how much more still needs to be done.

Cite as: Lisa Larrimore Ouellette, Do Patents Work?, JOTWELL (May 10, 2017) (reviewing Heidi L. Williams, How Do Patents Affect Research Investments?, Ann. Rev. Econ. (forthcoming), available at NBER),