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Today would have been the 95th birthday of Milton Friedman. |
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Today would have been the 95th birthday of Milton Friedman. |
E-mailing the professor for whom I'm working this summer, I asked if we could meet tomorrow after the lunch workshop that is scheduled to discuss the Grokster case. I haven't yet had time to review the decision, though it was wholly to be expected -- this is not a tech-savvy court nor one that thinks of intellectual property much differently than physical property. The unanimous Court of Eldred strikes again. (OK, that sounded vaguely like the title of a Star Wars book. -- UPDATE: Apologies to Justices Stevens and Breyer, who filed dissents in Eldred, and thanks to Will Baude for the correction.)
Indeed, after Kelo, I wonder if intellectual property may become a sort of safer investment than physical property. With all the allegations that the government fails to pay a genuinely fair market value for takings, perhaps you're better off putting your money into a research consortium than into real estate. I don't know much about takings, actually; does anyone know if the government ever has used that power to seize intellectual property?
Certainly the public use component of taking over pharmaceutical patents appears quite obvious: Medicare spends over $8 billion a year on prescription drugs, and being able to pay only for the cost of actual production and a little profit margin, or even only compensating the cost of R&D for the specific drug, would constitute a huge cost-saving for the government.
However, the concern with intellectual property that is much less likely to exist with physical property is that the fear of government taking would disincentivize people to create things worth patenting. While the government presumably wants people to make "improvements" on physical property -- think of historical incentives such as the Homestead Act, in which "improvements" substituted for payment to the government -- they usually aren't what the government is taking. As nice as the community built up in New London may be, it's only the land itself that the government wants to take and give to private development.
N.B., there is no "unanimous Court of Eldred".
Posted by: Will Baude at June 27, 2005 03:36 PMI don't know much about takings, actually; does anyone know if the government ever has used that power to seize intellectual property?
Monsanto applied the Takings Clause to trade secrets.
Posted by: Will Baude at June 27, 2005 03:40 PM"it's only the land itself that the government wants to take and give to private development"
I don't understand what you mean here. Presumably any improvements on the land that is taken will be destroyed by the new owner, right?
Posted by: Tom T. at June 30, 2005 09:13 AMI take it PG's point is that often the existing structures are knocked down. But not always.
Posted by: Will Baude at July 1, 2005 01:31 PMI don't understand what you mean here. Presumably any improvements on the land that is taken will be destroyed by the new owner, right?
Will got it: the improvements on the land are not what is sought. Indeed, it would be cheaper if the land had gone unimproved b/c then the gov't wouldn't have to pay for bulldozing. (I will leave aside discussion of whether the government would want the land if improvements on it had not contributed to creating a surrounding environment that the government finds desirable for some purpose.)
Even in cases where not all the existing structures are knocked down, my understanding is that the government rarely if ever makes a permanent taking (so I am excluding wartime commandeering of mansions that make excellent troops' quarters, etc.) of a building that is in a place in which they otherwise would have no interest. The land is valuable in and of itself.
With intellectual property, on the other hand, there is not much 'land' to begin with, and there's nothing to cry about unless the government is taking something valuable only because of the work you've put into it. (For some reason I'm having a flashback to the end of The Fountainhead when Howard Roark dynamites a public housing project that is a bastardized version of his plan.) Say you've improved the current version of the polio vaccine; the government can't 'take' it if they only continue to use the 'land' on which you built, i.e. the current version.
The Monsanto case is very nearly what I had in mind by an intellectual property taking, because the EPA essentially forces producers of information to turn it over to their competitors, although insofar as the information apparently is valuable only for a government regulatory process, it's not quite an exact parallel. Also note that this was a near-unanimous case, with O'Connor dissenting partially and White not taking part.
This may be due to the somewhat narrow holding, in which the property interest was only for the information submitted during a particular time when it could be designated as a trade secret and therefore the submitters had a "reasonable investment-backed expectation" that it would not be disclosed to others. I feel like I should go somewhere with that quoted phrase but my brain is dead.
Posted by: PG at July 2, 2005 03:52 AM