IPSC plenary

Tonya Evans, CryptoKitties,
Cryptography, and Copyright
Nonfungible digital
creativity, enabled by the ERC 721 standard on the Ethereum blockchain: verifiable,
indestructible digital scarcity.  NFTs
overcome failures of existing digital structure for creators by providing for ownership,
provenance, chain of title.  The
inability to distinguish master from copies currently harms demand/value.  Creator can participate in secondary market,
unlike current first sale situation.  Can
prevent forgery/theft unless the owner’s private key is compromised or
lost.  Securely distinct asset from a reproduction.
Sprigman: as I view
the CryptoKitty, it’s just pixels on the screen. Why can’t I just copy it? If
it’s valuable, it’s the picture they care about. Blockchain is valuable as a
speculation market, like tulips. The only difference here is you don’t get the
tulip. That’s interesting, but does this new thing prevent piracy?
A: On the NFT side
of things, where you look for provenance/uniqueness. If you just want the copy,
it might not matter. But blockchain can establish a record of ownership, assisting
in enforcement.
Sheff: proper
analogy then seems like fine art market. Scarcity is useful to increase prices.
W/r/t a digital image you can have anyway, which can be disaggregated from the
blockchain record, you’re just creating scarcity for its own sake/conspicuous/wasteful
consumption.
A: wholly digital
from the beginning; not a representation but the thing itself.
Q: what’s the
benefit of doing it this way?
A: decentralization;
censorship-resistant.
Deepa Varadarajan and
Joseph Fishman, Similar Secrets
Normative case for
necessary similarity b/t secrets given that employees can’t wipe their minds
between jobs. ©’s similarity framework makes some useful analytical moves. Like
© but not patent, trade secret scope isn’t defined ex ante by written
claims.  Trade secrets are easy to obtain
on the front end, leaving the difficult scope work to be done on the
infringement end.  (1) In terms of what
courts should be looking at, focus should be end that the D is actually
exploiting, not R&D along the way; (2) only material contributions should
be actionable; (3) only reasonably foreseeable uses should be actionable.
Shouldn’t affect core markets, but greater room for cumulative innovation in a
world of mobile talent.
Our focus is use
based misappropriation, not improper acquisition. Restatement says derivation
must be substantial, but very few courts explain how to do this. A number of
cases essentially ignore this in favor of a P-friendly conception of use in
which any aspect of any reliance on the secret in R&D is enough. Courts don’t
ask whether what was copied was the stuff that made the trade secret
protectable to begin with.
Ds shouldn’t need to
repeat known failures in their R&D. 
Courts should look for a material contribution from the P’s secret—not just
some benefit. Requires normative evaluation of whether the information D
exploited was important to making the secret protectable in the first place.
Contrast © which says copying isn’t enough; copying has to be significant/of
protectable elements. Today’s Ps can prevail even if they aren’t competing with
D; we think that competition in a relevant market should be required. Proximate
cause for unforeseen benefits instead of unforeseen harms.
Q: similarity to ©
isn’t a good thing b/c of lack of ex ante definition problems. Why not use
obviousness instead?  We know how to
worry about hindsight bias in patent better than in ©. Here’s what you knew,
here’s what you had reason to try/look for.
A: not all trade
secret eligible info is patentable. Very different definition of trade secret would
be required.
Lemley: the things
you’re drawing from © are not from substantial similarity; they’re from fair
use. Foreseeability etc. You are really saying trade secret should allow some
productive use/fair use. Might be harder to read that view into the statutory term
“use” though.
A: current actual
copying requirement looks like an actual copying Q in © shorn of the improper
appropriation next step.  Whether it’s
substantial similarity or fair use, that’s b/c substantial similarity has grown
to encompass so much more than it once did. The Q is still: are the two
products/activities similar enough to be liable.
Lemley: but you’ve
moved from intermediate copy to final copy, and the way we do that in © is fair
use.
A: doesn’t think
script/screenplay cases work that way [software cases do, Lemley notes w/o
disagreement]. [Script/screenplay cases are weird and probably also affected by
lingering questions not worth resolving about what constitutes a “work” and how
many different works are involved when you have multiple drafts.]
Kristelia Garcia
(and Justin McCrary), Reconceptualizing Copyright’s Term
Nielsen soundscan
data for music. Will suggest extrapolation to other commercial info goods like
books and movies, not to fine art. Findings best fit the average work—some of the
potential suggestions may overprotect some works and underprotect superstar
works. Random date-stratified sample of 1200 albums released b/t 2008 and 2017,
proportional to genres, w/physical and digital album sales/streaming.  Then looked at all songs w/in random sample
of 120 albums.
Unsurprisingly but
dramatically, lose 1/3 of sales volume w/in 2 months, ½ by 6 months, by less
than one year out 10% of initial volume. Songs decay more slowly. Album sales
drop to almost zero after less than a year, but songs have a somewhat longer
commercial life though nowhere near as long as current term.
Streaming: analysis
is more limited b/c data are limited; main streaming services didn’t make data
available until much later. 2016-2017 subset, sample size too small for
statistical significance—streaming results in far higher volume. Ave. streaming
volumes drop less rapidly than sales, as you’d think intuitively.
For typical music
production, rapid dropoff for sales.  Later
will look at genres and differences b/t blockbusters and others.
Implications: shorter
term? All info goods engage in windowing—single first, then album exclusive to
one service; similar in film (theaters, streaming, TV) and books. All of them
go quite quickly relative to the term. Also consistent w/winner take all
phenomena.  Albums are quickly hits or
not, like movies and books. Also consistent w/network effects.
Maybe duration isn’t
that important either way.  Perhaps this
is useful for countries still on the fence about Berne/duration. This might tell
them that extension isn’t efficient. Even adopts support for use it or lose it
standard a la Posner & Landes. Could also try other things like reversion
to the author [or limits on remedies].
Rothman: the spike
is probably related to ad campaigns—can you look at that for blockbusters?  Could you argue that precipitous dropoff
means that you need a really long term to recoup/make a living? Landes & Posner
argued about distribution rights & commercial difficulties/investment—but streaming
doesn’t have an additional cost, so far-out sales/revenue are opportunities for
artists to benefit many years later.
A: Germany has
something like this on the book side; if use it or lose it considered availability
on iTunes, then that’s easy/costless. We’d need some sort of marketing standard
to get some transfer back to authors.
Q: effect of illegal
copies?
A: usually available
through entire window and even before—so it’s hard to say but would buy an argument
that this mattered.
Sprigman: §115
licensing/Harry Fox—given the dropoff, Harry Fox issues affiliate licenses on
match, then processes, then pays out in arrears. So this may have implications
beyond term.
Q: Streaming curve
looks like a survival regression, with an uptick in song streaming at the end—the
stuff that persists and remains listenable/popular with everything else fallen
away.  [How much does the algorithm
affect this?  If it surfaces the same relatively
unpopular songs for every listener w/in a group, that might matter v. if it
randomizes w/in a group of equally unpopular similar songs.]
Rachel Sachs, Regulating
Intermediate Technologies
Health care tech
where we want to incentivize improvement of existing tech but we’ve set up the
system wrong. E.g., microbiome; pharma manufacturing (not much has changed over
the past 50 years, even though new drugs are being created—still using batch
manufacturing instead of continuous, for example, even though that could reduce
cost by up to 50% and even though batch mfg can lead to delays/shortages); genetic
testing. If we overregulate microbiome based therapies (which are unpatentable
but require FDA approval b/c treated like drugs) then we might not get the end
stage technology and never know what we’ve lost.  FDA knows its own regulations lock old
manufacturing in place, and even though companies can obtain patents on mfg
tech, the difficulty of enforcement is a disincentive.  Why did Myriad go differently, where the test
for breast cancer associated genes has become a lot better in specificity?  B/c in the early days it wasn’t regulated.
Need to discuss how
patent doctrines/sequential innovation literature interacts w/regulation from
FDA.  Designing best practices: public
investment in platform tech, calibrating regulation by stage at which the
research is, calibrating health insurer reimbursement by stage. Procedurally,
greater executive branch coordination and engagement w/regulated industry as
well as public.
We’ve hamstrung insurers
from calibrating reimbursement based on evidence of efficacy in
groups/subgroups.

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