Foundation Course on IP

IP: An Intangible Property

By: Antonio A.R. Mendoza Legal and Policy Consultant

7 February 2011 Cebu City, Philippines

OUTLINE

Intellectual Property as an Intangible Types of Intellectual Property Rights Economic Rationale of the Patent System

TANGIBLE VS. INTANGIBLE

Tangible property discernible by the senses Intangible property incapable of being perceived by the senses

Intellectual property is a set of legal rights that results from intellectual activity in the industrial, literary, scientific and artistic fields; they do not apply to the physical object but instead to the intellectual creation as such.

Civil Code of the Philippines: Article 712. Ownership is acquired by occupation and intellectual creation.

Intellectual property is governed by a special law, Republic Act 8293 (IP Code). Under the IP Code, the term intellectual property right consists of: 1. 2. 3. 4. 5. 6. Copyright and Related Rights Trademarks and Service Marks Geographic Indications Industrial Designs Patents Layout-Designs or Topographies of Integrated Circuits 7. Protection of Undisclosed Information
6

Trademark A trademark is a sign or symbol that distinguishes the goods or services of one enterprise from another in commerce. It is a word, device, symbol used to indicate the origin, quality and ownership of a product or service. Purposes of trademark: (1) indicate the source or origin of goods or services; (2) distinguish the goods or services from those offered by another; (3) assure that the goods are of a certain quality; (4) provide consumers with a tool in making decisions about the purchase of goods.
7

Businesses use marks to indicate that the goods came from them and that the goods are of a certain quality. The decision of consumers to purchase one product over another depends mostly on the marks carried by such goods, hence, the importance of providing a legal infrastructure for the protection of marks.

Copyright Copyright consists of a bundle of rights granted to authors and artists to protect expressive works against unauthorized reproduction or distribution by third parties. It protects original works of authorship, including literary, artistic and other works. Copyright is based on the principle of idea/expression dichotomy, which means that while the authors have the right to their original expression, the public is encouraged to build upon ideas conveyed by a work.

Patent A set of rights granted to the inventor of a product or process that is new, involves an inventive step and is capable of industrial application. A grant from the government that permits the owner to exclude others from making, using, or selling an invention. A negative right since it affords the right to exclude others from making, using, selling or importing a patented invention.

10

Examples of inventions
door lock, by Linus Yale, 1844 sewing machine, Isaac Singer, 1855

telephone, Alexander Graham Bell, 1876 electric light, Thomas Edison, 1880

11

Examples of inventions

roll film camera, George Eastman, 1888

shaving razor, King Gillette, 1904 airplane, Wilbur and Orville Wright, 1906

12

The mobile phone was invented by Motorola in 1973.

The current mobile phone that we are using now may contain hundreds of patents for the internal antenna, the screen, the keypad, the battery, etc.

13

Preamble to Filippos patent reads:

He refuses to make such machine available to the public in order that the fruit of his genius and skill may not be reaped by another without his will and consent; and that if he enjoyed some prerogative concerning this, he would open up what he is hiding, and would disclose it to all.

14

Why was there a need to demand state intervention before the inventor agreed to release knowledge or information about his invention? Isnt it that knowledge or information is a public good that is available to everyone?

15

Fundamental nature of information Non-Rivalrous Non-Excludable

16

Non-rivalrous
Information may be enjoyed by others at the same time. Consumption of a public good by one person does not leave less for any other consumer. Consumption of the good by one individual does not reduce its availability for consumption by others.

17

Non-excludable Information cannot be provided privately, as it would be difficult, if not entirely impossible, to exclude others from enjoying a public good. Costs of excluding non-paying beneficiaries who consume the good are so high that no profit-making firm would supply the good.

18

The non-rivalrous and non-excludable characteristics of information give rise to the problem of free riders. Free riders are those who exploit the information without contributing to its creation. Once information is out, you cannot take it back.

19

What is the significance of IP as an intangible property? In todays knowledge economy, intangibles represent 80% of a companys assets, while tangibles represent only 20%.

20

21

22