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The Role of Human Creativity in the Copyrightability of Artificial Intelligence-Generated Works

P. Bernt Hugenholtz & Joao Pedro Quintais, Copyright and Artificial Creation: Does EU Copyright Law Protect AI-Assisted Output?, 52 IIC - International Review of Intellectual Property and Competition Law 1190 (2021).

Do you believe in the human heart? I don’t mean simply the organ, obviously. I’m speaking in the poetic sense. The human heart. Do you think there is such a thing? Something that makes each of us special and individual?” This is a question put to Klara, the narrator of Kazuo Ishiguro’s novel Klara and the Sun, who is an “artificial friend”—an artificial intelligence (AI)-operated android- that, in a not-too-distant future imagined by the Nobel Prize winner for literature, is meant to replace companions for children.1

This philosophical question also lies at the heart of the question of the protectability by copyright of AI-generated outputs: Is there something in the human creative process that makes it unique and different from any output generated by a machine? And is the copyright system apt to incentivize and reward these moments of genius that generate new creative works and induces cultural enrichment?

In their article Copyright and Artificial Creation: Does EU Copyright Law Protect AI-Assisted Output?, Bernt Hugenholtz and Joao Pedro Quintais of the Institute for Information Law at the University of Amsterdam try to address this crucial issue from the perspective of the legal framework for copyright protection in the European Union (EU).

Their approach is not a philosophical one, but a legal, more technical one: can an AI-assisted output satisfy the criteria of copyright protection? Of course, the underlying policy question is not far, for if copyright protection is denied, this might induce policy makers to reflect on a possible legal instrument to be introduced to this effect.2 Also, the big normative questions such as the desirability of protecting AI by copyright, are deliberately not addressed. Nevertheless, their analysis is absolutely fascinating.

Indeed, their doctrinal approach towards advancing the AI protectability discussion provides an excellent examination of the various legal conditions developed over time by the Court of Justice of the European Union (CJEU) for an intangible output to benefit from copyright protection, which they put to the test regarding AI-generated outputs. By doing so, they undertake a categorization that has hardly been done (at least in such a clear manner) in literature before on the standard for protectability of copyrighted works in the EU.

It might come as a surprise to many but, as the authors rightly recall, “the EU currently is mostly silent on questions of copyright subject matter and authorship. Despite extensive copyright harmonization, no single directive harmonizes the concept of the work of authorship in general terms”. The conditions have been developed incrementally by the case law of the CJEU, and the authors scrutinize each condition to see if AI-generated outputs can qualify. As they underline, in order to be protected, AI-generated outputs need to be a “work” that is “original” in the sense that it reflects “creative freedom”. But since an AI-generated output has never been analyzed so far by the CJEU, the authors also reflect on possible unwritten aspects of the law as might be encountered when dealing with AI-generated works.

For instance, the authors examine the general idea that a work, in order to be protected, and further in line with the international copyright framework, needs to the result of a “human creative effort”. As they put it, “although EU copyright law nowhere expressly states that copyright requires a human creator, its ‘anthropocentric’ focus (on human authorship) is self- evident in many aspects of the law”. Indeed, the notion of originality is often defined as the expression of the personality of the creator, his creative choices, his “heart” or “soul” in the poetic sense of Kazuo Ishiguro that we have mentioned at the start of this review. This presupposes a human being, one capable of possessing a “heart” or “soul” in the first place. Thus, the authors conclude that according to EU conceptions of copyright “an output wholly generated by an AI system without human intellectual effort is excluded from copyright protection”. This conclusion also seems in line with the position of the US Copyright Office which, in a decision of February 14, 2022, refused to register an AI-generated work, finding that “human authorship is a prerequisite to copyright protection in the United States and that the Work therefore cannot be registered”.3

However, the authors’ analysis, unlike many other recent writings on the subject, does not stop there, as they underline that the necessity to have human intellectual effort “does not rule out creations by human authors made by the aid of machine”, provided that the other criteria of copyright protection are met such as e.g., the need to be original and to reflect creative choices.

At this point, they develop the main argument of the paper, which is that human creativity in AI-assisted production may occur in different phases of the creative process, which they propose to label “conception” (design and specifications), “execution” (producing draft version) and “redaction” (selecting, editing, refinement, finalization). They find that, “while AI systems play a dominant role in the execution phase, the role of human authors at the conception stage often remains essential. Moreover, in many instances, human beings will also oversee the redaction stage”, for example through editing the output generated before publication.

Accordingly, the authors conclude that when human-made creative choices “are expressed in the final AI-assisted output, the output will then qualify as a copyright-protected work”. The analogy can be made with other creative areas where the creators use machines as tools in their creative processes, such as computer program-operated digital art or even more classical creations such as photography where the photographer uses an automated camera, or the painter uses tools to disseminate the colors on the canvas without fully controlling the end-result. Such as the same idea with, for example, the recognition of ready-mades in contemporary art, what remains essential for a potential copyrightability is the creative choice of the human creator, not necessarily the execution of the artwork (as the object does not need to be made or produced by the artist, but only chosen).

Of course, from a more normative perspective, the findings of Hugenholtz and Quintais that many AI-assisted outputs can benefit from copyright protection does not solve the (pending) question of the social desirability of such conclusions and, ultimately, what could be the consequences on follow-on creativity if the gates of copyright will be opened too widely for these types of works. These questions of course are essential to solve for the future of creativity, and maybe more broadly for the future of our society. For now, the interesting analysis drawn by Hugenholtz and Quintais in their submission offers us a new perspective through which we can begin to view a complex societal issue more clearly, showing that if new technologies often raise groundbreaking questions, the answers from a strictly legal point of view are often not so new and that the copyright system potentially can adapt. But should it adapt, or should it rather be adapted? For sure, it opens fascinating paths for future research.

  1. Kazuo Ishiguro, Klara and the Sun (2021).
  2. Indeed, the article draws on a report done by the authors for the European Commission on the challenges to the IP framework posed by the developments of AI: P.B. Hugenholtz et al, Trends and development in artificial intelligence: challenges to the intellectual property rights framework (IViR and JIIP). Final report for the European Commission.
  3. U.S. Copyright Review Board, Re: Second Request for Reconsideration for Refusal to Register A Recent Entrance to Paradise (Correspondence ID 1-3ZPC6C3; SR # 1-7100387071) (Feb. 14, 2022).
Cite as: Christophe Geiger, The Role of Human Creativity in the Copyrightability of Artificial Intelligence-Generated Works, JOTWELL (April 29, 2022) (reviewing P. Bernt Hugenholtz & Joao Pedro Quintais, Copyright and Artificial Creation: Does EU Copyright Law Protect AI-Assisted Output?, 52 IIC - International Review of Intellectual Property and Competition Law 1190 (2021)), https://ip.jotwell.com/the-role-of-human-creativity-in-the-copyrightability-of-artificial-intelligence-generated-works/.

What We Think About When We Think About Ownership

Aaron Perzanowski, Consumer Perceptions of the Right to Repair, 96 Ind. L.J. 361 (2021).

Property scholars have long noted a gulf between the way laypeople think about ownership and how property law actually works.1 This gulf has widened in the digital age, as our beliefs about what we own and what ownership means have not kept pace with our complicated relationships with digital goods. Consider, for example, the furor that arose a decade ago when it emerged that Apple insisted that iTunes users did not own purchased music files outright but had only a lifetime license to use them.

In a sparkling essay, Aaron Perzanowski explores the distance between the perception and reality of ownership in the context of the emergent right to repair. Traditionally, we expected to be freely able to repair physical items we own, whether a book with a torn cover or a car with a leaking fuel line. But how does this expectation translate in the digital setting? The question, Professor Perzanowski shows, is an important and complicated one.

This issue is important not least because of the financial stakes. If fixing my iPhone’s screen requires only a visit to a third-party repair shop, that saves me money, but it costs Apple a lost purchase of an entirely new unit. And freedom to repair has other consequences. Users who can fix damaged digital goods extend the lives of those goods, saving them from becoming the kind of slow-decaying waste that is especially damaging to the environment.

This issue is complicated because in a world where technology increasingly pervades the objects we own, industries often design technological means to undermine users’ ability to repair their goods. Perzanowski catalogues a surprisingly vast array of anti-repair strategies: Some are relatively innocuous, like lowering the price of replacement goods to make repair relatively less appealing. Others are more sinister, like embedding devices with software that makes them less effective over time or making physical repair prohibitively costly due to the need to use expensive tools. Firms also leverage copyright and patent laws to intimidate users with dubious but chilling threats of litigation for engaging in unauthorized repair.

As Perzanowski carefully details, this issue has not gone unnoticed by lawmakers. State legislators have advanced several bills designed to preserve consumers’ ability to repair electronic devices, including the Promoting Automotive Repair, Trade, and Sales (PARTS) Act of 2017. However, the PARTS Act stalled in committee, Other state legislatures have had spotty success with similar initiatives. Perzanowski readily identifies the source of these failures. Well-heeled lobbyists representing a range of companies from Apple to John Deere to GE Healthcare have slowed reform efforts by voicing both public and closed-door objections to these laws.

Perzanowski points out that right to repair laws would succeed only if consumers actually do want to repair electronic devices. Only then would a law lowering barriers to repair actually cause consumers to engage in more repair. Perzanowski thus undertakes the only study to date that asks whether consumers believe they should have a right to repair devices they own. And, if so, how do they view manufacturer efforts to restrict repairs and how are attempts to restrict repair material to their purchase decisions?

Perzanowski’s article reports that consumers have a strong preference for freedom to repair. The vast majority of device purchasers agree or strongly agreed that they should have a right to repair those devices. Nearly as many expressed strong negative affect toward manufacturer attempts to restrict the right to repair. And equally significant majorities stated that their willingness to pay for a device will drop substantially if the device is burdened with repair restrictions.

Perzanowski is careful not to overstate the practical implications of these results. He notes that while passage of right to repair laws would create consumer surpluses and reduce environmental stressors, they would not be panaceas. Manufacturers remain free to complicate repair in ways that evade such laws, such as by simply declining to produce replacement parts or phasing out support for goods after a short time frame. That being said, Perzanowski makes a powerful empirical case that passage of these laws would produce major gains in overall social welfare.

Perzanowski’s work also raises important additional questions. For instance, even if consumers like the idea of repair, what’s to say they would effectuate it well? Manufacturers’ warnings about the risks of off-brand repair shops are not entirely baseless. Can these concerns be ameliorated by regulation or other means? Also, how can laws be crafted to more effectively counter manufacturers’ end-runs around right to repair statutes? It may at first seem a stretch for governments to mandate that industry must provide support and replacement parts, but some states—e.g., California—have adopted such laws. And as a practical matter, how can legislatures overcome the overwhelming pressure of industry lobbyists and pass right to repair laws?

Perzanowski is about to release a book-length treatment of this topic, The Right to Repair: Reclaiming the Things We Own. This monograph promises to address these questions immanent in Perzanowki’s essay.

  1. See Thomas Grey, The Disintegration of Property, in Nomos XXII: Property 69 (J. Roland Pennock & John W. Chapman, eds.) (“In the English-speaking countries today, the conception of property held by the specialist (the lawyer or economist) is quite different from that held by the ordinary person.”).
Cite as: David Fagundes, What We Think About When We Think About Ownership, JOTWELL (March 28, 2022) (reviewing Aaron Perzanowski, Consumer Perceptions of the Right to Repair, 96 Ind. L.J. 361 (2021)), https://ip.jotwell.com/what-we-think-about-when-we-think-about-ownership/.

Prior Art in Copyright

Joseph P. Fishman & Kristelia García, Authoring Prior Art, 75 Vand. L. Rev. __ (forthcoming 2022), available at SSRN.

Patent and copyright law share what the Supreme Court calls a “historic kinship”: they both grant exclusive rights under the IP Clause to incentivize production of new knowledge goods. But they implement this goal through very different doctrinal frameworks, including different roles for “prior art”—all the information that existed before the innovation at issue. Patent validity crucially depends on whether an invention is new and nonobvious compared to the prior art. In contrast, it doesn’t matter if a copyrighted work is similar to earlier works as long as it wasn’t actually copied from them. Copyright treatises unquestioningly assert that the formal prior art analysis of patent law has had no place in blackletter copyright doctrine.

The doctrinal trend identified in a new article by Joseph Fishman and Kristelia García, Authoring Prior Art, is thus interesting and surprising: in at least some recent copyright music cases, judges are looking at prior art. One judge even dismissed an infringement claim for “failing to consider prior art,” rendering the comparison between the original and infringing works “legally deficient.” Another dismissed a claim because the plaintiff’s expert report lacked “any information about prior art,” whereas the defendant’s expert cited three earlier songs with similar expressive qualities. Identifying this trend would be valuable on its own, but Fishman and García go further in tracing the source of this development to the influence of a small set of musicologist expert witnesses.

Judges rely on experts in music cases more than in any copyright field except software, perhaps because they are less comfortable assessing the similarity of musical works than works like novels, films, and paintings. And the pool of music copyright experts is tiny: Fishman and García analyzed fifty reports and found that they were produced by only ten experts, with one expert producing 23 out of 29 defense-side reports. These defense-side reports generally identified prior art to argue that any similarities between the allegedly infringing work and the copyrighted work were also present in the prior art, and plaintiffs’ experts generally argued not that prior art is irrelevant, but that any prior art wasn’t that similar to the copyrighted work at issue. Fishman and García also interviewed six of these experts, who described a perceived duty to assess the prior art not only to determine whether the defendant’s work was actually copied from the plaintiff’s, but also to evaluate the creative importance of any similarities between the works.

To understand exactly how these cases are using prior art in the infringement analysis, it’s worth recapping the relevant blackletter doctrine. Assessing whether a defendant copied enough from a plaintiff’s work to constitute copyright infringement first requires filtering out any unprotectable elements, such as abstract ideas and “scènes à faire”—stock elements that are ubiquitous in the genre. The works are then compared for “substantial similarity” from the perspective of the ordinary observer of the works in question. Both steps of this analysis are frustratingly vague, especially for those trained in the comparatively formulaic rules of patent law: it isn’t easy to draw a line between unprotectable ideas and protectable expression or to determine if any remaining similarity is “substantial.”

Prior art isn’t a formal part of this doctrine, but it is implicit in the analysis. Judges know that “star-crossed lovers” is an abstract idea that should be filtered out because this idea recurs in prior art ranging from Romeo and Juliet to Buffy the Vampire Slayer; they know that shootouts in Westerns and dead phones in horror films are scènes à faire because of prior art in these genres. (Patent readers might analogize to the amorphous category of “abstract ideas” like “longstanding practices” under recent patentable subject matter caselaw.) The musicologist expert reports—and cases that follow them—surveyed by Fishman and García make this reliance on prior art explicit, and they expand the relevant prior art from ubiquitous elements that judges are personally familiar with to a more patent-like universe of all prior works identified through specialized search tools. Experts frequently argue that elements drawn from the prior art should be discounted in the substantial similarity analysis as “musicologically insignificant,” so that a work cannot be infringing if it is closer to the prior art than to the plaintiff’s work.

This approach is similar to that suggested a decade ago by Rebecca Tushnet, who asked whether “substantial similarity doctrine could be improved by, in essence, placing the plaintiff’s work alongside an array of prior art and trying to place the accused work in the ‘space’ defined by the expressive universe,” and then framing the legal question as “whether the similarity between the plaintiff’s work and the accused work is any greater than the similarity between the accused work and [the prior art].” For these reasons, the recent adoption of prior art analysis in music copyright cases may be a beneficial development. As Fishman and García explain, “prior art allows judges to understand a work in its creative context rather than in a vacuum.”

Fishman and García don’t offer a prediction on whether this use of prior art will expand into non-music cases, or whether such an expansion would be a good thing. These seem like important questions to pursue in future work, both by scholars and by practitioners and experts in other copyright cases. Prior art is certainly not a panacea—facts and broad ideas can’t be copyrighted even if far removed from the prior art, just as natural laws and abstract ideas can’t be patented no matter how novel. But if prior art could make the elusive line between ideas and expression somewhat more predictable, that would be a welcome development for both potential copyright litigants and future students of IP law.

Cite as: Lisa Larrimore Ouellette, Prior Art in Copyright, JOTWELL (February 17, 2022) (reviewing Joseph P. Fishman & Kristelia García, Authoring Prior Art, 75 Vand. L. Rev. __ (forthcoming 2022), available at SSRN), https://ip.jotwell.com/prior-art-in-copyright/.

Should (Some) Political Uses be Presumptively Fair?

Cathay Y. N. Smith, Political Fair Use, 62 Wm. & Mary L. Rev. 2003 (2021).

According to conventional wisdom, fair use factor two plays a minor role, if any, in copyright cases. But, as Cathay Smith shows in Political Fair Use, this factor plays a major role—and may even be dispositive—in cases involving “political uses” of copyright-protected works. Through a series of case studies, Smith “identifies a pattern in political fair use decisions: in disputes arising from the unauthorized political uses of copyrighted works, courts appear to implicitly modify their analyses and balancing of the fair use factors under section 107 of the Copyright Act.”

Fair use is a fact-intensive, case-by-case inquiry. The Copyright Act sets forth four factors that courts should weigh in determining whether a use of parts or all of another author’s work is fair:

  1. the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
  2. the nature of the copyrighted work;
  3. the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
  4. the effect of the use upon the potential market for or value of the copyrighted work.

When considering factor two, courts often consider the extent to which a work embodies creative expression or is more informational or functional in character. Some types of works are deemed closer to the “heart” of copyright. Accordingly, the use of a creative work is less likely to be fair than the use of an informational one. In the standard fair use case, factor two tends to play a minor (if any) role; factors one and four are generally the most important.

Smith argues that the “political use” cases are different. She defines a “political use” as “the use of original copyrighted works by politicians or about politicians.” This “occurs when a politician or political candidate uses another’s creative expression to express political speech or when a person or party uses another’s creative expression to speak about a politician or candidate.” So defined, use of the “Success Kid” meme by Rep. Steve King’s campaign would be a political use, but Infowars’ use of the character Pepe the Frog (a use not connected to any particular politician or candidate) would not.

Smith observes that in political use cases, factor two “seems to exert an outsized influence on the determination of all four fair use factors.” Specifically, when the underlying works are political—e.g., in cases dealing with photographs of a candidate or music created for a political ad—courts deem those works to “informational” and thus the use is more likely to be fair. And where the underlying work is political and the defendant’s use is also political, the defendant is “overwhelmingly” likely to win on the ultimate question of fair use. Consider, for example, a situation in which a photo taken of a political candidate at a political rally is used in an adversary’s political advertisement. These types of political uses (we might perhaps think of them as “nominative political uses”) seem to be being treated as almost presumptively fair.

Not only does Smith’s article challenge the conventional wisdom about fair use factor two, it also delves into larger questions about the purpose of copyright. Smith posits that, when it comes to other political uses (we might think of them as “distasteful political uses”), courts engage in the adaptation of fair use analysis “in order to both accommodate the import of political speech and to respect copyright owners’ dignity and rights to control objectionable uses of their expressive works.” For example, in the “Success Kid” case, the court ruled for the copyright owner—and against fair use—where the original work was not political in nature and where the copyright owner (the child’s mother) was strongly opposed to Steve King’s political positions and didn’t want the meme associated with him. Of course, at least in the United States and as Smith notes, we don’t generally think of copyright as a regime that is meant to protect authorial dignity or allow authors to veto uses just because they don’t like them. If it’s true that courts are providing some kind droits morals in political use cases, that is notable in and of itself.

Smith’s article also revisits the well-known tension between copyright and the First Amendment. In Eldred v. Ashcroft, the Supreme Court suggested that the fair use doctrine internalized First Amendment values in copyright law. See 537 U.S. 186, 221 (2003). The pattern of fair use cases Smith identifies may be seen as an encouraging sign that fair use is flexibly adapting to core political speech. But Smith expresses concern that, at least in some cases, courts may actually be applying the fair use framework too rigidly: “Political fair use appears overinclusive in certain scenarios when it fails to account for the privacy, dignity, or economic interests of creators of works that happen to embody a political nature and underinclusive in other scenarios in which concerns for the dignity rights of a creator seem to override common applications of parody, transformativeness, and fair use.” In either case, Smith’s article adds an important new facet to this discussion as well.

Cite as: Sarah Burstein, Should (Some) Political Uses be Presumptively Fair?, JOTWELL (January 18, 2022) (reviewing Cathay Y. N. Smith, Political Fair Use, 62 Wm. & Mary L. Rev. 2003 (2021)), https://ip.jotwell.com/should-some-political-uses-be-presumptively-fair/.

Valuing a Higher Threshold for Trade Secrets

Camilla Alexandra Hrdy, The Value in Secrecy (Sep. 16, 2021), available at SSRN.

What makes a secret a trade secret worth enforcing? Trade secrets have traveled a bumpy path from the basis for a common law gut feeling about unfair competition to a federally enforced intellectual property right. Because almost any kind of “information” can be a trade secret, trade secret doctrine has a reputation for being a fact-soaked free-for-all. This is especially true when compared to the contours of copyrights, trademarks, and patents, which are strict at least in theory.

In The Value of Secrecy, Professor Camilla A. Hrdy calls for legal rigor and, despite the reputation that trade secrets are an opportunity to air grievances about contract loopholes rather than valid assets, finds that rigor in the statutory text and in courts’ recent rulings. Her hot-off-the-presses article posits that “independent economic value” is, descriptively and normatively, a meaningful threshold for trade-secret eligibility. Although a reader unfamiliar with the ins and outs of trade secret law may get a bit lost in the nuances, Professor Hrdy’s article on this fast-developing doctrine also illuminates to the generalist both the divide between legal theory and legal practice and the importance of framing a narrative to fit a court’s expectations.

Centrally, Professor Hrdy argues that a trade secret must have commercial value that is caused by its secrecy. This idea naturally emerged from the history of trade secrets in American jurisprudence and modern statutory manifestations (including the UTSA, developed as a uniform proposal that many states have adopted as-is, and the federal DTSA, passed by Congress in 2016). But it challenges common wisdom that the “value” requirement is as lifeless as the “utility” requirement in patent law.

It also challenges revered scholarship, such as William Landes’s and Richard Posner’s landmark economics work, that a trade secret’s value is self-enforcing; that is, a secret is necessarily valuable if someone went to the trouble of litigating it. It’s like the old joke, where an economist won’t acknowledge a $100 bill lying on the ground because, if it were really there, someone would have already picked it up. Well, not in Professor Hrdy’s view. She believes that both the text of the law and practical concerns, which so often sour good theories, make independent economic value not just worth considering but necessary.

First, she explains that “independent economic value” should be understood as a derivation of “competitive advantage,” which has always undergirded the character of a trade secret. “Information” is otherwise too broad a definition for intellectual property, particularly in light of the finicky web around copyrights, trademarks, and of course, patents. Professor Hrdy suggests that trade secrets, too, must fit into a standard rather than simply stretching out into a residual category. A trade secret that offers a “competitive advantage” means that a secret does not become a trade secret unless it provides a commercial edge over rivals. And independence requires that the secrecy of the information itself provides that competitive advantage. The secrecy of a password, while important, does not itself confer an advantage. But the allure of a secret sauce? Absolutely.

Second, she identifies the influence of this standard in case outcomes from the last five years. Courts with the opportunity to offer fresh interpretations of the DTSA have been scrutinizing the character of “information” to determine whether it qualifies as a trade secret as a matter of law. The myriad paths that courts have taken appear to lead to the same place. That is, courts have used a variety of circumstantial and direct methods to detect, whether they state it explicitly or not, independent economic value. Professor Hrdy’s review determined that courts probed the following: whether the value is commercial (rather than, for example, relational); whether it is valuable enough (albeit suggesting that “triviality” remains the rather low bar); whether the value was added because the information is secret (a masked form of causation); and whether the information has foreseeable or actual value (not a futuristic whim or outdated notes).

Professor Hrdy’s article is noteworthy for her success in imposing a framework on a doctrine that many commentators have dismissed as a scattershot cause of action—one that depends more on storytelling than doctrine. Her job wasn’t easy. She admits at least one type of information (religious scriptures) that was found to be a protected trade secret in one forum and unprotected in another. However, Professor Hrdy insists that the effort is worth it to prevent unreasonable lawsuits. She does not employ the term “trade secret troll,” but she cites a few articles that do. Trade secret litigation can and has been used to harass firms and former employees who find it too expensive to participate in a legal drama.

The article could do more to highlight that trade secrets, particularly, open the door to fishing expeditions into competitors’ business practices in ways that overwhelm the comfort of a discovery protective order. For former employees, naturally vulnerable defendants, the very threat of years-long litigation is the de facto enforcement for outrageous non-compete agreements. Even without these details, however, Professor Hrdy’s point is clear: a federal cause of action for trade secret protection opens the doors to colorable claims that can be cataclysmic for small actors, and judges should be able to close the courtroom doors to secrets that are asserted for this secondary value (i.e., leverage) rather than for independent economic value.

Cite as: Julia Haines, Valuing a Higher Threshold for Trade Secrets, JOTWELL (December 10, 2021) (reviewing Camilla Alexandra Hrdy, The Value in Secrecy (Sep. 16, 2021), available at SSRN), https://ip.jotwell.com/valuing-a-higher-threshold-for-trade-secrets/.

Impacts of Pharmaceutical Capture on Public Health Outcomes

Liza Vertinsky, Pharmaceutical (Re)Capture, 20 Yale J. Health Pol’y L. & Ethics __ (2021).

At the heart of Professor Liza Vertinsky’s excellent article, Pharmaceutical (Re)Capture, lies a persistent paradox: Although the U.S. innovation ecosystem is one of the most sophisticated and advanced in the world, its technological prowess has not resulted in broadly distributed public health benefits. On the contrary, the U.S. experiences some of the highest spending in biomedical innovation, but some of the poorest health outcomes as compared with other developed countries.

Historians of medicine call the belief that the societal path to better health lies in technological interventions a “biomedical approach to health.” This approach has profoundly influenced global and U.S. health care policy in the twenty-first century. An alternative, “sociomedical,” approach looks at expensive, high-technology innovations with a certain degree of skepticism, prioritizing instead broad access to low-cost, low-technology primary health care. Biomedical approaches, however, have eclipsed global and domestic sociomedical practices.1

Intellectual property scholars have paid little attention to this tension between high technology innovation and poor public health outcomes. Driven by its internal focus on designing interventions for incentivizing innovation, much of the intellectual property literature ignores the equally important question of why the impressive technological advances in our healthcare innovation ecosystem have not resulted in equally impressive public health benefits.

Liza Vertinsky’s article fills this important gap by providing a novel and useful way to understand this paradox from an institutional design perspective, which she has characterized as the “pharmaceutical capture of healthcare markets.”

We are all familiar with uses of the term “capture” in the context of regulatory capture of administrative agencies, in which agencies become dominated by the very firms they were created to regulate. In Vertinsky’s article, pharmaceutical capture refers to that industry’s wide-ranging and holistic strategy to systematically influence key players in innovation and healthcare markets at multiple points in the drug development, marketing, and enforcement life-cycle. She argues that traditional understandings of regulatory capture do not adequately reflect the pervasive web of influence that pharmaceutical companies exert over social and market structures. Rather, new models of regulatory capture are needed to reflect the complex set of interlocking influences that tend to further private pharmaceutical interests, often at the expense of public ones.

Vertinsky traces the evolution of various theories of regulation. She begins with the public interest theory of governmental regulation, which posits that government agencies can be trusted to regulate private interests in the service of the public good. She then discusses the post-New Deal pessimism about the ability of governments to avoid being captured by firms they regulate. This pessimism about the effectiveness of governmental oversight has come from both the left and the right. The next phase has focused on public interest litigation to enforce public policies and accepted the now widespread assertion that market imperfections seldom justify governmental intervention.

In pharmaceutical markets, Vertinsky’s key insight is that the structure of the market itself can be “captured” by pharmaceutical interests. This includes molding preferences of key actors such as doctors and patients, social definitions of disease, clinical data and understandings of disease, and the content of medical training.

What makes this type of capture possible are several unique features of pharmaceutical markets. Two are especially worth highlighting. One is an innovation ecosystem that is both fragmented and overlapping, and in which governmental actors lack the ability to coordinate policy with each other and with sophisticated corporate actors that have adopted systematic approaches to influencing policy. A second is a belief in the private sector as the primary engine of lifesaving biomedical innovation, which is a version of the biomedical view of public health.

Vertinsky documents this problem through a case study of the opioid epidemic. She documents the dizzying web of relationships among pharmaceutical companies and prescribers, academic institutions, physicians and patient advocacy groups. Mobilizing these relationships, pharmaceutical companies contributed to the social construction of “pain management” and “chronic pain” as a discrete disease category with specific guidelines for treatment. They also co-opted “patient-centered” language and funded advocacy groups to push the idea of the right to be free from pain—all in the service of increasing prescriptions of opioid medication. As Vertinsky explains, “the healthcare response was largely to increase the prescription of opioids for chronic pain,”2 a biomedical approach that sidelined other more time-consuming behavioral pain therapy approaches.

In short: Pharmaceutical capture has enormous social costs. This makes the claim that any governmental intervention would be worse than an imperfect market particularly suspect in the healthcare context.

To overcome the pharmaceutical capture that has made the U.S. healthcare system so dysfunctional, Vertinsky calls for a pharmaceutical recapture through regulation around public health goals. The first step would simply reframe the deregulation debate as “really a debate over alternative governance models.”3 So conceptualized, “the question of regulatory capture becomes one of how different governance models may favor different actors.”4

A comprehensive recapturing plan, in an area with so many moving pieces, would require several additional papers, but Vertinsky leaves us with an important guiding principle: Governments need to develop holistic, systemic, and flexible approaches to regulation to match the industry’s systemic strategies. One possible path forward would revitalize local public health departments as sites of coordination. If well-funded, these departments could balance the scales that now tip so heavily in favor of biomedical approaches.

  1. See, e.g., Randall M. Packard, A History of Global Health: Interventions into the Lives of Other Peoples (2016).
  2. At 45.
  3. At 7.
  4. Id.
Cite as: Laura Pedraza-Fariña, Impacts of Pharmaceutical Capture on Public Health Outcomes, JOTWELL (November 12, 2021) (reviewing Liza Vertinsky, Pharmaceutical (Re)Capture, 20 Yale J. Health Pol’y L. & Ethics __ (2021)), https://ip.jotwell.com/impacts-of-pharmaceutical-capture-on-public-health-outcomes/.

The Threat Value of Copyright Law

  • Cathay Y. N. Smith, Weaponizing Copyright (May 2, 2021), 35 Harv. J. L. & Tech. __ (forthcoming, 2021), available at SSRN.
  • Cathay Y. N. Smith, Copyright Silencing, 106 Cornell L. Rev. Online 71 (2021).

In two related pieces, Professor Cathay Y. N. Smith revisits the issue of plaintiffs using the threat value of copyright law to advance claims or interests other than protecting the value of original expression. As she documents, these threats appear to be on the rise in response to the growth of the internet and social media, the lack of coherent privacy law in the United States, and the comparatively powerful array of remedies copyright offers copyright owners.

This review focuses on the larger argument in Weaponizing Copyright, which generalizes from, and incorporates much of the argument from, Copyright Silencing. In it, Professor Smith has three overarching goals: (1) to expose the growing prevalence of “weaponizing” copyright; (2) to explain why copyright is more attractive than other bodies of law to achieve these non-traditional enforcement objectives; and (3) to argue that some non-traditional uses of copyright are justified while many others are not.

The first section identifies the enforcement objectives that she views as weaponizing copyright: (a) to suppress facts embedded in copyrighted works; (b) suppress others’ speech, particularly criticism; (c) punish or retaliate for non-copyright-related conduct; (d) protect reputation and moral rights; and (e) to protect privacy. One background fact that undergirds these examples is the privatized copyright enforcement system that YouTube has established through which three “copyright strikes” against an account holder results in deletion of the account. This system adds a new type of threat value to copyright law.

Smith begins with accounts of retaliatory uses of copyright. Copyright has been used to push back against online racism and sexism. When infamous Twitch celebrity PewDiePie shouted a racist slur while streaming himself playing one video game, the copyright owner of a different game filed a copyright strike to retaliate for this, and other similar episodes, by PewDiePie. In a similar vein, Alinity, a woman also popular on Twitch, responded to a misogynistic comment he made about her and other women gamers while commenting on her video by filing a copyright strike.

Two of Smith’s other examples less cleanly fit her narrative because the parties were already in a legally adverse relationship. A subchapter in the well-known free-speech dispute between Rev. Jerry Falwell and Larry Flynt involved Hustler’s ultimately unsuccessful copyright infringement suit against Falwell for using unauthorized copies of the parody at the heart of their dispute for fundraising purposes. More recently, Sony Records is in a termination-of-transfer dispute with Southside Johnny and another artist. To deter the growing number of artists seeking termination, Sony sought to counterclaim against the artists for contributory copyright infringement because they authorized their attorney to use Sony-owned album art on the attorney’s website to recruit new artist clients.

Smith next turns to uses of copyright to suppress unfavorable facts. The most well-established form of this practice is by public figures or their estates, e.g. James Joyce or Howard Hughes, who assert or acquire copyright to suppress unauthorized biographies. For an online version of this practice, Smith relays the story of television doctor Drew Pinsky (Dr. Drew) who dismissed the seriousness of Covid-19 in the early stages of the pandemic. When YouTuber (yes, it’s now a noun) Dr Droops posted a five-minute compilation of Dr. Drew’s statements. Drew filed a copyright strike and takedown notice on YouTube, which took down Dr Droops’s compilation. While the video was eventually made available again, the effort to suppress was temporarily successful.

Smith’s third category is related, but focuses more specifically on using copyright to censor criticism. Her examples includes the Church of Scientology and Jehovah’s Witnesses sending DMCA takedown notices to suppress critical commentary; Netflix sending takedown notices to Twitter to suppress criticism of its controversial film Cuties; and talk radio host Michael Savage threatening a civil rights organization and a documentary film production company for using clips of Savage’s on-air anti-Muslim tirade from 2007 in connection with critical commentary. While Savage’s suit against the civil rights organization was unsuccessful on fair use grounds, his takedown notice against the film was more effective.

The fourth category—protecting reputational and associational interests—is one that Smith agrees is a more traditional use of copyright, since these interests are explicitly protected by moral rights outside the United States. Her examples here include musicians and meme creators who sought to stop political uses of their creations by politicians or groups with whom they want no association.

The final category is uses of copyright to protect personal privacy. Copyright is an imperfect tool to combat nonconsensual pornography unless an image is a selfie, in which the author and subject of an image are the same. But, in the subset of cases involving selfies, copyright takedown notices can be an effective antidote. Sympathetic photographers can use their copyrights in aid of the interests of their subjects, as was done by a photographer who sued the anti-marriage-equality group Public Advocate for using her wedding photos of a gay couple holding hands and kissing in their mailings. Last, are celebrities who have asserted copyright against gossip publications that have obtained leaked photographs or videos.

The article’s second section explains why copyright law is a more attractive legal tool than other areas of law to advance the interests discussed above. In short, obtaining copyright and stating a prima facie claim for infringement are quite easy, enforcement costs are asymmetrical, copyright remedies enable speech suppression without traditional First Amendment review, copyright defenses are insufficient to deter questionable claims, and U.S. law does not provide robust privacy protection or moral rights that might more directly advance some of these interests. A few points that Smith discusses in this section are particularly worth noting. Enforcement cost asymmetry is exacerbated by YouTube’s copyright strike system because filing a strike is relatively cheap and easy, and the potential costs of losing a valuable social media account are quite high. The counter-notice option under the DMCA notice-and-takedown system is largely ineffective, and counterclaims that might raise the costs of aggressive enforcement, such as copyright misuse or state law anti-SLAPP actions, are unavailable. Finally, other sources of law are less effective tools because they are subject to First Amendment review and any attempt to enlist the aid of platforms will be unsuccessful because of Section 230.

After a section recognizing that mixed-motive cases will challenge any policy response to the uses of copyright she has discussed, Smith turns to three potential policy responses. The law can reject all uses of copyright that are not associated with protecting economic interests of the copyright owner, permit at least uses to protect personal privacy, or accept uses that advance dignitary and reputational interests so long as they do not involve suppressing criticism or disclosure of facts.

In engaging with the existing scholarship, Smith is sympathetic with uses of copyright to protect privacy interests, particularly in cases of nonconsensual pornography, but she expresses concern that if privacy is defined too broadly it could also support uses of copyright to suppress evidence of domestic violence or other abusive behaviors. She also sees merit in focusing reform efforts on developing areas of law that more directly protect the interests discussed in the Article.

In the end, Smith concludes that a general line-drawing approach to addressing all of the uses of copyright she discussed would be too difficult, but that the evidence of increased uses of copyright to censor criticism or suppress unfavorable facts should be addressed by making enforcement more symmetrical. Three ways to do that would be to make copyright misuse an affirmative claim, allow anti-SLAPP laws to apply to censorious copyright litigation, and strengthen the balance in the DMCA notice-and-takedown process to deter abusive takedown notices.

These recommendations receive more attention in Copyright Silencing, but I would have liked to see these further developed in this piece. With that said, I enjoyed reading this article, and I agree that Professor Smith has identified some troubling uses of copyright that are exacerbated by the current structure of social media’s privatized dispute resolution scheme, particularly YouTube’s strike system.

Cite as: Michael W. Carroll, The Threat Value of Copyright Law, JOTWELL (October 12, 2021) (reviewing Cathay Y. N. Smith, Weaponizing Copyright (May 2, 2021), 35 Harv. J. L. & Tech. __ (forthcoming, 2021), available at SSRN; Cathay Y. N. Smith, Copyright Silencing, 106 Cornell L. Rev. Online 71 (2021)), https://ip.jotwell.com/the-threat-value-of-copyright-law.

“Trademark, Labor Law, and Antitrust, Oh my!”

Hiba Hafiz, The Brand Defense, 43 Berkeley J. Emp. & Lab. L. __ (forthcoming, 2022), available at SSRN.

I am allergic to antitrust law, but after reading Hiba Hafiz’s recent article, I understand that my aversion is problematic. This paper combines an analysis of trademark law, labor law, and antitrust law to explain how employers exploit trademark law protections and defenses to control labor markets and underpay and under-protect workers. For most IP lawyers and professors, this article will open our minds to some collateral effects of trademark law’s consumer protection rationale on other areas of law with important consequences for economic and social policies.

The Brand Defense says it “takes a systemic view of intellectual property, antitrust and work law,” which means reading it demands keeping several balls in the air and following their interacting paths. It is worth the effort. Here are three paths the article’s argument follows.

First, Hafiz explains how broadened trademark protections for franchisors, like McDonalds, shift obligations from the franchisor to the franchisee. This means that individual restaurants or other franchisees must tightly monitor workers and products in service to “the brand.” This monitoring means that ingredients, components, machines, and processes are strictly regulated under the franchise agreement, leaving little leeway on profit margin for the franchisee except in the cost of labor.

Second, franchisors structured their relationships with franchisees as independent business entities to take advantage of developing antitrust law to functionally immunize their franchisor-franchisee relationships from antitrust liability. Vertical integration by contract or license (as opposed to through ownership) supposedly produces economic efficiencies to consumers, which is thought to alleviate the need for close antitrust scrutiny. But, as Hafiz demonstrates in her literature and doctrinal review of antitrust law, antitrust benefits are supposed to flow both to product markets and labor markets. Hafiz shows that when franchisee-franchisor agreements significantly constrain franchisee choice in the production of goods and services, this leads franchisees to skimp on worker protections and wages, which is also an antitrust harm. Hafiz persuasively argues that antitrust court decisions mistakenly view brand protection (through trademark licensing agreements) as ultimately encouraging competition between brands to consumers’ benefit while ignoring the harm to labor markets.

The third path follows the development of lawful but distressing labor practices by which upstream employers can avoid responsibility towards downstream franchisee workers by arguing a combination of trademark protection (“the brand defense”) and vertical disintegration. Upstream franchisors impose obligations on downstream employer-franchisees through businesses contracts, which include trademark licenses. They use this to claim the absence of a joint-employer relationship despite stringent flow-through quality control requirements. Once again, product quality and labor policy are artificially disentangled. Concern over the latter is hidden or depressed in favor of the consumer welfare justification that anchors both trademark and antitrust law.

There is so much to commend this article: its succinct legal history of the three areas of law; the clarity of its doctrinal analysis in light of the complex and interacting legal regimes; and the unapologetic championing of worker power in an era of increased economic inequality and burgeoning threats to democracy that ideally ensures accountability.

Different readers will draw different insights from it. The breadth of the terrain it covers makes it broadly appealing. When reading The Brand Defense, intellectual property lawyers and professors are likely to experience something familiar suddenly becoming strange. Hafiz describes how trademark law meant to promote consumer confidence and pro-consumer competition between goods and services is harnessed to justify anticompetitive vertical restraints and unfair labor practices.

Trademarks … confer broad[] value as legal trumps in antitrust and work law, immunizing lead firms’ legal exposure for anticompetitive conduct in labor markets and work law violations. Upstream firms have thus deployed a sophisticated set of legal strategies highlighting purported consumer benefits of branding in a way that has successfully obscured agency and court view of the effects of their market power, or wage-setting power, in downstream labor markets and over downstream employees’ terms and conditions of work. (P. 51.)

This is not the typical trademark framework, to say the least. And those writing and thinking about how broader scope of trademark protection produces incumbency benefits, disadvantages small companies, and injures competition and communication, should take note. The Brand Defense is a thoroughly devastating critique of contemporary trademark practice along related lines, but it enlists the adjacent legal fields of work law and antitrust to drive the points home. The doctrinal and regulatory reforms proposed at the end are straightforward, bold, and unfortunately (to me) unlikely to transpire given the current political climate. But the proposals derive from diverse legal mechanisms and thus provide various opportunities of attack.

I cannot guess how readers from the antitrust or labor law fields will find The Brand Defense. If you are less allergic to trademark law than I am to antitrust law, Hafiz’s article is well worth your time. Even if you are allergic, Hafiz’s sophisticated ideas, delivered in systematic arguments, will bring you far enough along to learn a lot about the twenty-first century workplace and the doctrinal and regulatory framework inhibiting the fight against destabilizing economic inequality.

Cite as: Jessica Silbey, “Trademark, Labor Law, and Antitrust, Oh my!”, JOTWELL (September 10, 2021) (reviewing Hiba Hafiz, The Brand Defense, 43 Berkeley J. Emp. & Lab. L. __ (forthcoming, 2022), available at SSRN), https://ip.jotwell.com/trademark-labor-law-and-antitrust-oh-my/.

Profiting Off Infringement

Kristelia Garcia, Monetizing Infringement, 54 U.C. Davis L. Rev. 265 (2020).

It’s hard to imagine people tolerating intentional violations of their physical autonomy, never mind seeking to monetize such behaviors. But as Kristelia García argues in her new essay, Monetizing Infringement, many copyright owners find this strategy appealing.

According to copyright’s standard narrative, infringement reduces the returns to creative effort and, thus, undermines authors’ incentives to produce new works. Here, however, García “destabilizes long-held but problematic assumptions about the interplay between copyright law’s purported goals and its treatment of infringement by challenging the received wisdom that rightsholders are necessarily anti-infringement.” (P. 270.)

Building on work by Tim Wu, Dave Fagundes, and Rebecca Tushnet, among others, García catalogues three distinct forms of monetizing copyright infringement across a variety of creative domains: (1) profitable infringement, in which infringement results in income for the rightsholder; (2) remedial infringement, in which infringement mitigates a worse outcome for the rightsholder; and (3) promotional infringement, in which infringement amounts to valuable and cost-efficient promotion for the rightsholder’s content.

It is well known that owners of sound recording copyrights have found user-generated content on YouTube to be a profitable form of infringement, thanks to YouTube’s Content ID system. When musicians’ fans create and post videos to YouTube, record labels can reap the advertising revenue without having to generate their own content. But García also describes how video game developers rely on sales of extra downloadable content, like additional levels and characters, to benefit from pirated versions of their games. While users may be able to pirate a game for free, they are often willing to pay for added content that increases its appeal.

Game developers also encourage what García calls remedial infringement, encouraging piracy when it is a less significant problem than others that they face. For example, gray market resellers offer game “keys” that allow purchasers to access games and promotional content for lower prices than the developer is charging. Often, however, the keys don’t work, and the developers spend considerable time and money responding to complaints about fake and broken keys. In response, García notes that several developers have opted to encourage users to simply pirate their games, instead of using gray market sites. Either way, the developers argue, they aren’t being paid. But at least they don’t have to deal with the additional headache.

Most interesting to me is García’s category of promotional infringement and her example of musicians encouraging fans to create videos that incorporate the musicians’ songs and post them online. In some cases, the original video will generate millions of views and promote fan interest in the song. In other cases, the video will inspire others to create their own versions. But in either case, the potentially infringing videos can generate new streams and new revenue for musicians. García and I elaborate on this phenomenon in our forthcoming article, “Pay-to-Playlist: The Commerce of Music Streaming.”

Having cataloged various forms of monetizing infringement, García then elaborates on potential reasons why copyright owners might engage in this behavior rather than simply suing (or threatening to sue) for infringement. She notes how copyright law covers a wide variety of content and actors with a fairly similar set of legal rights. This opens up the possibility that owners simply have very different preferences and norms with respect to uses of their works. García also suggests that monetization may be an effective strategy in situations where technology changes more rapidly than law. Although authors might not prefer this strategy in a perfect world, they may come to rely on it where industrial changes outpace legal ones.

Finally, although this article is largely descriptive rather than normative, García considers the potential costs and benefits of monetizing infringement. On the benefits side, she includes the efficiencies of private ordering, tailoring the law’s one-size-fits-most approach, and an effective shrinking of copyright’s scope and duration, at least for those who aren’t targeted with infringement actions. But monetizing infringement has costs as well. It is easier and safer for larger established players than it is for upstarts or independents. Selective copyright enforcement can also lead to confused norms and user uncertainty. If one gaming company allows or encourages infringement, that doesn’t mean that others will—or that this one will continue to do so in the future and for everyone.

The realities of how copyright law is wielded in the hands of owners often differ from the standard narratives that lobbyists and scholars articulate about incentives and access. García’s work joins a growing movement of scholars who are exploring the ways in which the law interacts with the particularities of actual creative industries. This is an important contribution for scholars who want to move beyond just-so stories and abstract theories.

Cite as: Christopher J. Buccafusco, Profiting Off Infringement, JOTWELL (July 29, 2021) (reviewing Kristelia Garcia, Monetizing Infringement, 54 U.C. Davis L. Rev. 265 (2020)), https://ip.jotwell.com/profiting-off-infringement/.

Dirty Hands, Dead Patent?

Sean Seymore, Unclean Patents, 102 B.U. L. Rev. __ (forthcoming, 2022), available at SSRN.

The 2018 Federal Circuit Gilead Sciences v. Merck & Co.1 decision is one of the rare patent cases in which a court has applied the unclean hands doctrine to withhold a remedy for infringement. Sean Seymore used this case as a launching point for a deeper and more expansive reconception of the role of the unclean hands doctrine in patent law. He suggests that a range of pre-issuance malfeasance by the patentee, not just inequitable conduct before the USPTO, should preclude relief for the offending plaintiff against all defendants.

The doctrine of unclean hands is best known in patent law as the origin of the inequitable conduct defense, which renders patents obtained from the USPTO through materially deceptive behavior permanently unenforceable against anyone. Unclean hands, however, is both broader and narrower than inequitable conduct. It is not limited to misconduct in patent prosecution, but it only prevents the patentee from enforcing the patent against the particular defendant in the action involving the misconduct; other defendants are fair game.

So, while inequitable conduct results in permanent unenforceability, unclean hands only creates relative unenforceability. The rationale for this dichotomy is that if the patentee’s misconduct did not occur during the process of obtaining the patent, the underlying property right remains taint-free. Thus, only enforcement of the right in the proceeding to which the misconduct relates should be disallowed.

Many pundits remarked the surprising revival of the standalone doctrine of unclean hands –untethered from inequitable conduct– in the Gilead Sciences decision. However, Seymore goes deeper, using the case as an opportunity to propose a more robust, expansive, yet theoretically sound role for unclean hands in patent cases; a role which complements, without subsuming, its inequitable conduct progeny.

In his thought-provoking article, Seymore identifies a type of pre-issuance misconduct that raises the same misconduct-in-patent-acquisition concerns as inequitable conduct, but because it does not involve USPTO proceedings, gets treated as unclean hands with only relative unenforceability (as between the parties) and not permanent unenforceability with erga omnes effect.

This result, according to Seymore, makes no sense. He persuasively argues that a more equitable and symmetrical approach would be to treat all misconduct that taints the patent right ab initio the same: by imposing a remedy of permanent unenforceability.

The facts of the Gilead case exemplify Seymore’s scenario of concern. There, Gilead shared its Hepatitis C lead compound, sofosbuvir, with Merck as part of a technology collaboration subject to a confidential firewall agreement. Merck violated the agreement by allowing one of its in-house lawyers — prosecuting Merck’s own applications — to participate in a teleconference where he learned sofosbuvir’s structure. He later amended Merck’s pending applications to cover sofosbuvir. Moreover, when Merck later sued Gilead for patent infringement, the same attorney gave false testimony at trial.

Gilead’s successful assertion of an unclean hands defense was based on both the litigation and pre-litigation misconduct. In affirming the holding, the Federal Circuit noted that the pre-litigation business misconduct met the requirement for the unclean hands defense by potentially enhancing Merck’s legal position, possibly expediting patent issuance, and likely lowering invalidity risks in litigation. These were all directly connected to the patent enforcement relief sought.

Seymore employs a series of examples to distinguish actions triggering inequitable conduct, such as submitting fabricated data to the USPTO, from those with which his proposal is concerned. An example of the latter is falsifying information in a grant proposal that results in an award of funds later used to develop a patented invention. While there is no fraud on the USPTO, there is fraud on a federal agency and the patent is the fruit of that poisonous tree. As such, per Seymore, the patent should be rendered permanently unenforceable.

An intriguing example of “misconduct” in the article is poaching for the public good. In this scenario, a hypothetical COVID-19 vaccine manufacturer seeking to speed up product development, poaches an employee from a competitor (who has already developed a vaccine) and uses the knowledge of what does not work obtained from the employee to accelerate its product development and FDA approval.

While the public benefits from a second vaccine on the market, should the manufacturer be able to enforce its vaccine patent(s) against a different competitor? Is there a sufficient nexus between the possible trade secret misappropriation (poisonous tree) and acquisition and enforcement of the patent (fruit)? Should engaging in bad conduct for a good cause affect the taint? Or should we be less concerned about not enforcing patents (which could exclude other manufacturers from the market) in a public health situation? Such tensions are beyond the article’s direct focus but perhaps could fruitfully be explored in future work.

Considering the open-ended nature of the unclean hands determination, and the risk that it could devolve into a patent litigation “plague”2 like inequitable conduct pre-Therasense,3 Seymore wisely cabins application of his proposal with several constraints. These include a tort-based proximity requirement: misconduct that lacks a sufficient nexus to acquisition of the patent right (what he calls collateral misconduct) should be subject to the ordinary unclean hands remedy of relative unenforceability. He also articulates five discretion-limiting principles and aligns the proposal with normative justifications for the doctrine such as court integrity, public interest, and deterrence of wrongful conduct.

Seymore candidly notes that his proposal could result in overdeterrence: patentees taking inefficient precautions to avoid misconduct, or bypassing patents for trade secret protection. He further opines that bona fide purchasers for value without notice of the misconduct could be harmed (and patent rights made more uncertain) if his proposal is adopted. Nevertheless, he concludes, quite correctly, that this risk already exists for inequitable conduct, and that the high hurdle of clear and convincing evidence required for proving unclean hands provides a further critical limit. He also suggests ways for patentees to purge the “taint” before filing for patent protection and provocatively queries whether some types of “uncleanness” in patent law should be tolerated, citing to the largely defunct moral utility doctrine.

I probably appreciated Seymore’s paper more than most because he elegantly develops a wonderfully cogent theory that I wish I had been aware of in writing an article over a decade ago. At the time, I alluded to a kind of pre-litigation invention-creation misconduct possibly recognizable in equity, but my effort was under-theorized. Sean Seymore’s insightful recognition of the latent implications of the Gilead decision’s resurrection of the unclean hands defense in patent cases was a pleasure to read and an important evolution in thinking about equitable doctrines in patent law.

  1. 888 F.3d 1321 (Fed. Cir. 2018).
  2. “The habit of charging inequitable conduct in almost every major patent case has become an absolute plague.” Burlington Indus., Inc. v. Dayco Corp., 849 F.2d 1418, 1422 (Fed. Cir. 1988).
  3. Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276 (Fed. Cir. 2011).
Cite as: Margo Bagley, Dirty Hands, Dead Patent?, JOTWELL (July 2, 2021) (reviewing Sean Seymore, Unclean Patents, 102 B.U. L. Rev. __ (forthcoming, 2022), available at SSRN), https://ip.jotwell.com/dirty-hands-dead-patent/.