The Disaggregation of Intellectual Property, continued


Trademark provides potentially permanent protection for words and symbols that identify goods and services. In the mid-19th century, when it first emerged from the murk of the common law of unfair competition, trademark law shielded only marks that included the name of the person or company that sold something. Bit by bit, the kinds of things that could be protected against competitors expanded. Originally, just the names of providers of services could be trademarked; later, products were added. Services were initially limited to the names of hotels and newspapers; later, any service could be protected. Arbitrary or fanciful names for products, like EXXON or Kodak, became subject to protection. Descriptive marks--like Fish Fri for frying batter--also became subject to protection against competitors, so long as they had already become associated in the minds of consumers with particular manufacturers.

A series of nonrepresentational marks were later added to the fold. Today, symbols--the Nike swoosh, for instance--may be protected by trademark. Owens Corning is the only manufacturer allowed to make pink insulation, since the color of its product is now protected by trademark. Similarly, the sound of the NBC chimes cannot be used by competitors. "It Just Feels Right" is likely too short a phrase to be protected by copyright law, but Mazda has an exclusive right to use it as a trademark in conjunction with cars. Only Levi's may place a label on the edge of the back pocket of a pair of jeans, no matter what the label says; other manufacturers must pick different places.

Eventually, companies began to receive trademark protection for things that seemed less like insignia and more like the products or services they were selling. Consider the shape of a Coke bottle or the decor of a Mexican restaurant--the color scheme of the awnings and the waitresses' uniforms--both of which are shielded against imitation under the rubric of trade dress.

Trademark law now even covers product configurations. The uniforms of the Dallas Cowgirls are shielded, so long as they have acquired secondary meaning and are not, in the eyes of a court, functional. Similarly, no car manufacturer is permitted to make a car that closely resembles a Ferrari Testarossa.

The expansion of the three fields has resulted in increasing amounts of overlap. For example, while all computer software programs are protected by copyright law, a rapidly growing subset (currently over 100,000) are also protected by patent law. Certain industrial designs--objects that are both useful and aesthetically pleasing--are potentially subject to intellectual property protections under offshoots of all three fields: as copyrightable "useful objects," through design patents and as product configurations recognizable to consumers.

Making Sense of the Growth

No single factor explains why the coverage of intellectual property law has been expanding so steadily. Rather, several intertwined forces--economic, political and ideological--appear to be at work. Here are what seem to be the most important: The transformation of the American economy, from agricultural to industrial to service-based to informational, has resulted in an increase in the number and variety of interest groups clamoring for greater protection of their intellectual products. At the same time, the United States has gone from a net importer to net exporter of intellectual property. There has been a dramatic increase, starting in the early 20th century, in the perceived importance of advertising, which has made strong trademark protection seem even more imperative to the firms that engage in it. Americans' deep commitment to a labor-desert theory of property, together with an associated equity theory of distributive justice, has helped fuel arguments that creators deserve fair returns for their creativity. Popular suspicion, rooted in classical liberalism, of governmental involvement in the process of identifying and rewarding good works of art and socially valuable inventions has fueled hostility to governmental reward systems as alternatives to intellectual property law. The growth of the romantic notion of authorship and the corresponding celebration of the genius inventor has played a part. The groups favored by most extensions of intellectual property have been highly concentrated, while the groups disfavored have been dispersed. Finally, the term "intellectual property," with its substantial rhetorical force, has gradually displaced an older vocabulary centered on the phrase "limited monopolies."

Those are what seem to me the principal causes of the growth. A separate question is whether the expansion has been socially desirable. With respect to the first waves of growth, the answer is probably yes. Most of the extensions of the zones of protection made in the 19th and early 20th centuries were necessary adaptations to the emergence of new kinds of works. The creators of those works had legitimate interests in compensation and would not likely have produced them at optimal rates absent legal shields against competition.

In contrast, most of the most recent expansions have been pernicious. For example, there are plenty of incentives other than the hope of securing a patent for making innovations in athletics. Many aspects of the product configuration doctrine in trademark law are similarly problematic. Consider, for example, the Romm Art case (1992), holding that the Israeli artist Tarkay had established an artistic style--featuring languid women with lowered eyelashes in vaguely European cafés--that was infringed by the posters of Patricia Govezensky, even though no single Govezensky poster was deemed an infringement of Tarkay's copyright in a given work. Finally, the recognition of business method patents is regrettable. No one suggests that the rate with which new business models were generated before 1998 was suboptimal or that the rate has since increased. The result is that patents on business methods produce all of the well-known disadvantages of patent law--deadweight losses and litigation costs, for instance--without any offsetting social gains. Many other recent extensions of intellectual property law turn out, under scrutiny, to be similarly ill-advised.

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