This section is devoted to the analysis of patent rights as legal institutions. Its main objective is to settle a framework which allows a suitable definition of the legal nature of patents. It deepens the debate about the advantages and disadvantages of extending the figure of property rights and monopoly rights to patent rights, seeking to find a basis to evaluate each theory and propose a suitable institutional framework 433. Intellectual property rights evolve as an extension of the institution
433 Contra Miller and Davis at 17.
of private property to copyrights. The coherence and convenience of extending the framework created for copyright to patent rights is questioned.
1. Dichotomy between Right of the Inventor and Patent Right.
a) Definition of the Right of the Inventor
The right of the inventor is the inherent component of the patent right, and thus, an essential element to define the legal nature of patent rights. The discussion of the legal nature of this right was especially relevant in Germany at the end of the World War II, because at that time the patent office was closed. This fact left inventors without protection434. As a result, inventors appealed to the tribunals of justice to obtain a patent equivalent protection based on the general principles of law. Relying on general principles of law, some German tribunals granted patent equivalent protection to inventors, i.e., the right to exclude thirds parties from the imitation of invented ideas. Specifically, inventors rights were sometimes defined as equivalent to property rights, justified by the same philosophical foundation of property rights. An example of this is a court decision in Mainz (LG Mainz), involving an invention whose patent protection was applied for but finally not granted because the patent office was closed during the war435: “A person has in the technical creation of his spirit, on the basis of no other formal fact than the technical creation (creation of a technical newness of an inventive step), his embodiment or the record and its disclosure, attached original rights over these immaterial goods (Immaterialgüterrechte). These rights are related to the existence and dignity of the human personality, and his right to freely develop. They are, together with the right of tangible property, and alike this similar right, of imperative character, innate and natural belonging to the man”. This court concluded that the right of inventor has seldomly been used because of the existence of formal patent protection, which evolved from monopolies to privileges to the modern patent system. However, the right of inventors are protected by the Arts. 1, 2, 14 and 19 of the GG and are of direct application based on general principles of law as long as there is no specific legislation which
434 See Schroeter, Kurt, Die Sittenwidrigkeit bei der Benutzung fremder Arbeit und Gedanken im Wettbewerb, 1949 GRUR 228, 228.
delimits it436. A similar position was maintained by the RG in a earlier decision in 1913, in which it declared that in the case that an inventor has a patentable invention, his patrimony can be negatively affected when his right of inventor is infringed, since there is no doubt that in such a case that right of inventor is available before the granting of the patent437.
b) Differences between the Right of the Author and the Right of the Inventor
The right to be recognized as an inventor (inventor’s right) is not included in the patent right, but recognized by general principles of law which is born with the inventive activity and includes the results discovered by the inventor. Because of that it goes beyond the expiration of the patent right438. Once the invention is completed, the right of the inventor includes the right to claim a patent right. The inventor has the right to the invention, which permits him to claim a patent according to § 6.1 of the Paris Convention.
In Germany the protection of the relationship between the inventor and his invention has been recognized as a right of personality, protected by § 823 BGB (sue for damages) and § 104 BGB (action of injunction)439. Additionally, German patent law used to expressly recognize the right of the inventor to protect his fame. For example, §§37, 63 and § 124 PatG81 acknowledges the inventor’s right to be mentioned in the publication of the patent, and a right to have a recognition as inventor (fame)440.
The right of the inventor includes the right to decide how to exploit his invention commercially. This right includes the power to decide whether he wants to continue developing his invention, disclose it, patent it or maintain it secret441. According to German law the inventor has the right to exploit the invention giving
435 Decision of the LG Maninz (Mainz District Court) of September 6, 1949, Case No. P. Q. 2/49 in 1950 GRUR 44, 44-45.
436 Id. at 45.
437 See 83 RGZ 37 (July 3, 1913) “Klappstuhl”.
438 See Schulte, Rainer, Patentgeseztz mit Europäischem Patentübereinkommen, Cologne, 1994, 142-143
439 See Case No. 6U71/62, decision of Juni 6, 1963 of the OLG Frankfurt (Frankfurt District Court of Appeals), in 1964 GRUR 561 and BGH, Case No. XZR 2/76 (OLG Mü), Decision of October 24, 1968 in 1979 GRUR 145, 148, and Hubmann at 112-113.
440 Hubmann at 112-113 and Schulte at 143.
441 See Benkard, George, Persönlichkeitsrecht und Erfindungsschutz, 1950 GRUR 481, 488. See also 52 RGZ 227, 231 (October 3, 1902) ; Hubmann at 113 and Schulte at 143.
licenses and protecting it as a secret or know how against illegal espionage or disclosure by persons who obtain the information in confidence. In any case, contrary to copyrights, with the publication of the public exploitation of the invention, the private technical idea which constitutes the invention looses his individual character and becomes an objective idea of public domain442.
Thus, the inventor’s right is similarly constructed as the inherent right of property, i.e., the right to dispose at will his invention. An alternative approach to explain the “inherent character” of this right, based on the quasi-contractl of unjust enrichment, will be proposed in chapter four.
c) Protection of Inventors Rights through Competition Law in Germany
Considerations related to public order and loyal competition have also moved courts to use general principles of law to recognize the special right of inventors, particularly § 1 UWG. This Article grants protection against constituent actuations which are against good moral and therefore, configuring unfair competition. This law has been applied not only in constituent facts or actuation which induce deceit about the origin of a performance (danger of confusion). The enrichment of parties that boundlessly take advantage of the work results of competitors also has been included in the constituent facts of § 1 UWG443. Thus, this article has been applied to protect from imitation not only non technical but also technical factual objects444.
Following this reasoning, courts considered imitators taking profit from the defenseless situation of inventors, which for example, occurs during in the period when the producer is applying for a patent protection, to be contrary to loyal competition and morality445. A similar position was taken in the late 1940s when the special legislation referring to patent rights was suspended. The suspension of
442 During the World War II the German Office was closed and no patents were granted. At that time it was discussed in Germany whether the inventor’s right could include an exclusion right as an extension of the personality right. German case law conceded protection only against illegal
imitation. See Hamburg Court of Appeals in 1950 GRUR 481, Benkard at 488 and Hubmann at 114.
In some exceptional cases an exclusion right as element of the personality right protected at § 823 BGB was recognized. See LG Mainz in 1950 GRUR 44; Benkard at 481-90; and Hubmann at 114.
443 Schroeter at 230.
444 Id. See also UWG (Act Against Unfair Competition) §1, (para.) 443 at 559-560.
445 See decision of March 16, 1940, Case No. 138/39 in 1940 GRUR 489, 491 (“Filterpresse”).
patent legislation was considered an exceptional situation in the legal culture of the land446. This motivated a change in the German jurisprudence concerning §1 UWG and 826 BGG447. This jurisprudence considered the imitation of inventions, taking profit of the defenseless situation of inventors imitation caused by the suspension of the patent legislation to be contrary to morality, in cases where these inventions present the requirements for patent or industrial design protection.
This attempt to base inventors rights on competition law did not prosper, and was reject by further case law. Competition law, as it has been traditionally conceived, is unsuitable for inventors rights. Its goals have not been the protection of the performance and results of the work of creators, or the right an inventor has over his invention. Protection through competition law is granted under different circumstances than the “technical and functional aspects” which characterized patent protection448. The goal of competition law is not the protection of the work result of inventors, but the protection from particular abusive actuation of imitators, taking into consideration particular subjective circumstances: the abuse of competitors position of competitors, and this protection is granted by an action for injunction, to order the refrain of competition and the payment of damages449. In such a case, it should be proved that the defendant, when causing the damages, acted with full knowledge or with a significant negligence450. In addition, it should be proved that the act of imitating generates unfair competition. Examples of situations that may generate unfair competition are: 1.- The confusion of the origin of the products 2.- The appropriation of immaterial resources created by competitors, when an unjust spare of costs is generated, which granted a prevalence in the economic performance and competitiveness451. 3.- The competitor, knowing full well that the imitated invention contains all the characteristics of a patentable invention, as well as the knowledge that the inventor is in the process of applying for protection, takes advantage of particular transitory
446 Schroeter at 228.
447 Id. at 236. See the decision of the KG of May 12, 1948, Case No. 6 U 896. 47 in 1948 GRUR 207, which precisely changed the jurisprudence referring to §§1 UWG and 826 BGB. Cf. decision of March 16, 1940, Case No. 138/39 in 1940 GRUR 489, 491 (“Filterpresse”).
448 Reimer, Eduard, 1 Wettbewerbs- und Warenzeichenrecht, Berlin, 1933, 99.
449 Schroeter at 229 and Reimer at 99-100.
450 Reimer at 344.
451 Schroeter at 236.
circumstances which hinder the inventor from obtaining the protection granted by law452.
To conclude, within a competiton law framework, the right of the inventor is not sufficient for giving him protection from the imitation of competitors. In order to claim an illegal imitation a case of unfair competition should be demonstrated. This requires proof that the imitator knows who invented the technology and the relationship between the way in which he uses the technology and the invention453. Furthermore, the mere interest to protect the invention from imitation is not protected by UWG § 1 and § 286 BGB as unfair competition. This protection would only be granted when a exceptional invention is imitated and there is danger of confusion between the device that the imitator put in circulation and that of the original invention, because the imitator has not attempted to find a way to impede this danger of confusion454. Additionally, the first inventor cannot impede another inventor from working on the same technological problem and arriving to a similar or equivalent invention455. Consequently, the sole act of invention does not grant an personal right on the sense of § 823, 1 BGB to exclude third parties; it does not grant an exclusive right. In order to obtain a exclusion right, the invention should be protected whith a patent456. As a result, within the traditional framework, there is a clear distinction between the goals of intellectual property rights and competition law. In Chapter four, an alternative approach is presented, which provides a general framework for both, competition and intellectual property rights.
The private property approach, framing the inventors right as an absolute right to exclude, joint with important differences in the legal and economic interests involved in the object of protection of patents impede the right of inventors from being considered equivalent to the right of authors and in general to the right of property. This differences may explain the different treatment given by case law and legislation to the exclusion rights of inventors (patents) and the exclusion right conceded to authors (copyrights).
452 OLG Hamburg, decision of November 3, 1949, Case No. U 186/49, in 1950 GRUR 82, 86.
453 See Benkard at 488.
454 See OLG Hamburg, decision of November 3, 1949, Case No. U 186/49, in 1950 GRUR 82.
455 Id.
456 Hubmann at 114. See also Reimer at 99.
2. Theoretical Justification for Using Private Property in Copyrights a) General Aspects of Copyright Protection
The concept of intellectual property rights was originally created as a framework to describe and regulate copyrights. This theoretical evolution is coherent with the goals of the copyright system and with the traditional function of the private property institution457. Copyrights present some particular characteristics that led to their recognition as “inherent rights”. These characteristics can provide an explanation for the early extension of the property right institution to copyrights.
Inventions and artistic works claimed to be protected in order to warrant its creator the possibility of benefiting from the fruit of his work and to protect their moral rights.
There are enough similarities between the object of protection of a copyright and the object of protection of private property, and its correspondent way of protection. Unlike patents, protection under copyright laws is not linked to registration at the Copyright Office458. Any work which is original, i.e., was neither in the public domain, nor copied from another, and represents a modicum of intellectual activity is eligible for copyrigh protection459. The right is born with the creation of the work460. In addition, the creation of an identical work, if it is done independently, is also protected, and constituted a valide defense against a claim of copyright infringement461. As a result, creators need no fear the existence of pre-existing rights which would thraten their copyright462. Thus, protection of authors is also more generous, in the sense that it is granted for the duration of the life of the creator and the subsequent fifty years463. In addition, the requirement of the existence of an intellectual work result is not so strength as in patents, where novelty and an inventive step is required. The requirement of originality means in
457 See Rogel Vide at 14-15.
458 See Audretsch, David, Intellectual Property Rights: New Research Directions, in Albach, Horst, Intellectual Property Rights and Global Competition, Berlin, 1995, at 35, 42.
459 See Audretsch at 43.
460 Ilzhöfer, Volker, Patent-, Marken -und Urheberrecht, Munich, 1995.
461 Audretsch at 43.
462 Stewart, S.M. at 51.
463 Id. at 42. In Germany the protection is according to §§ 7,8 UrhG (Copyright Act) extended to the subsequent seventy yearsSee Ilzhöfer at 116.
may cases no more than that the creator can truthfully say - “This is all may own work”464.
There are other relevant interests of the author that justified the consideration of copyrights as “inherent rights”. These characteristics are linked to the object of protection of copyrights.
The object of protection of subjective rights is the part of the external reality to which the right refers465, it limits the kind of external entities that are protected by the right. In principle, object of a private property right is every material thing that is subject to trade (merchandise) and also all the immaterial things that present the same characteristics of merchandise, for example, rights466. The equivalence between the object of a copyright and the object of a private property is allowed by the way the object of a copyright is defined.
Similar to the case of private property, the work of the creator, both as an expression of his personality and as materialization of his particular skills, constitutes the justification of the protection granted by the copyright. However, not all the elements including the work results of creators are protected. The protected work consisted in choosing the elements which are to be inserted in a composition and the definition of the arrangement or the order in which these elements are presented. Because of the possibilities of finding other expressions of these ideas, simple work and dedication can create alternative ways to materialize those ideas. Although the ideas and techniques used by creators (original or taken from the media) constitute the rough material for the final expression of their work, only the final expression or the creation is protected, not the technique or the ideas used to obtain that result467. Therefore, object of protection of copyrights is precisely the final shape and presentation form of a literary or artistic work468. Consequently, the use of a technique remains free to others, and because of that, not the technique used, but the final shape and presentation constitutes the principal source of the market value of a literary or artistic work.
464 See Stewart, S.M. at 51.
465 Baylos Corroza, H. at 451.
466 See Cribbet, John, Principles of the Law of Property, Brooklyn, 1962, 4-5.
467 For example, Section 102(b) of the US 1976 Act precludes copyright protection for “any idea,
procedure, process, system, method of operation, concept, principle, or discovery”. See Dreyfuss and Kwall at 290.
468 Ilzhöfer at 118.
The object of a copyright is not the whole creation, but the expression of the ideas it contains469. It excludes the protection of the original ideas included in the artistic or literally work. This exclusion is also justified by the fact that the protection of the innovative idea would hinder completely the liberty of expression of the other members of the community, who would be legally inhibited to express their ideas about the protected innovative idea to the public. This principle has produced a corollary maxim that even expression is not protected in those instances where there is only one or so few ways of expression an idea that protection of the expression would effectively accord protection to the idea itself470. Furthermore, because an artistic or literal work will normally include a wide range of ideas that are combined and integrated, it is very difficult to establish when an idea is copied or taken from a determinate work of another author. The negative effects of protecting the original ideas on the liberty of expression and development of art and culture are so evident, that they have hampered the definition of copyrights over ideas. These considerations may explain why the trend of the US Supreme Court has been to consider the promotion of arts and sciences as the primary purpose of the monopoly granted to copyright owners, with financial rewards to creators as a secondary concern471.
b) Analysis of the Characteristics of Copyrights that Justify the Use of Private Property
The extension of the institution of private rights to copyrights is facilitated by the similarities that the object of a copyright has with a material commodity. Because the objectives or interests protected by property rights and copyrights present many similarities, the translation of the private property institution to copyrights constitutes a coherent solution to the problem of defining the legal nature and regime of copyrights.Copyrights protect not only the interest of the author to commercially exploit his work, but also the intellectual and personal relationship the author has with his creation472.
469 Id. at 259. See also Mazer v. Stein, 347 U.S. 201, 217 (1954).
470 Id.
471 Id. at 232-33. See also H.R. Rep. No. 2222, 60th Cong., 2d Sss. 7 (1909).
472 Ilzhöfer at 128. See also Stewart, S.M. at 58-59.
The main similarities between copyrights and private property can be outlined by the following characteristics:
(1) Intrinsic Value of Artistic and Literal Work
(1) Intrinsic Value of Artistic and Literal Work