Musing "I don't think that monopolies are a good thing for consumers" is not the way to figure out what laws or just or not. You don't just toss of this kind of stuff, implicitly assuming that an unprincipled, incoherent, ad hoc consequentialist or utilitarian standard is the appropriate one for justifying the use of force against people. Antitrust law is wrong, because it is the initiation of violence against people who have not initiated violence against anyone else. Antitrust law is theft. It is like taxation or other forms of regulation. the state has no right to tell people waht to do with their property, so long as they are not violating others' rights. If one company acquires a monopolisitc position because consumers voluntarily pay them money for providing them with services or goods they value, then no one's rights are violated. The state has no right to step in. At all. If two companies collude to set prices, that is their right. If you don't want to guy from them, don't. You don't have a right to their products or for them to make an offer. The free market, and justice, and liberty, are about respecting people's property rights. so long as people do not commit acts of aggression they should be left alone by the state and the law. Just because some liberal activist law professor or state-paid economist says it's "bad for social welfare" if peopl "are allowed" to have "monopolies," this is no justification for the armed thugs of the state to threaten some peaceful businessmen with imprisonment. Antitrust law is utterly and completely evil.
Richard: Just because some "rules are needed" for a free market to function does not mean "anything goes." In fact the rules needed are fairly simple: define and respect property rights and contracts. Antitrust law is unsupported by sound economic theory and also is immoral as it punishes companies for charging too much (monopolization), too little (predatory price cutting), or the same as others (collusion). This lets the state cherry pick who it wants to persecute. And the economics make no sense whatsoever. There is no objective way to define "the relevant market." There are innumerable other problems with it as shown by scholars like D.T. Armentano , Murray rothbard, and even Alan Greenspan and Robert Bork. http://mises.org/daily/4397/ http://mises.org/daily/2694 http://mises.org/daily/5005/Alan-Greenspan-Was-Right-About-Antitrust-Anyway
"Anti-trust laws, properly formulated, do not punish companies for being too successful. What they do is to prevent those companies from turning financial success into political power that they can use to entrench their position beyond what they could achieve using honest market forces alone."
Think about what you said: it's about preventing them from getting political power. Now this is actually not true--that's not the aim of antitrust law. But if it were, you want to trust the state itself, to enact laws limiting corporate power, to ... prevent corporations from getting state power. Why doesn't the state just pass a law addressing this very issue, instead of using antitrust law as the excuse? The state could limits its own power to be bought by corporations, or limit teh ability of corporations to bribe the state. The solution to the problem that large companies get in bed with the state is to limit the power of the state in the first place, not to hobble companies so that they never become rich or successful enough to have enough money to buy politicians!
"Similarly it is a mistake to see minimum wage and other employee protection laws as helping big business at the expense of small."
It is not a mistake at all; it is reality. Take a look at my previous link where I link to a discussion about Rothbard and Kolko on this. Just b/c state propaganda characterizes its policies a certain way does not mean it is so.
"What these laws should do is to prevent business from exploiting its workforce and then externalising the human cost so that the rest of society has to pick up the pieces. The reason such laws can appear to favour big business over small is not in their essence but rather in the bureaucratic means that are employed to implement them."
This is not true. this is in fact the essence of such laws. Walmart, for example, recently lobbied for an increase in the minimum wage. The reason is walmart already pays its employees above minimum wage. So it would not be hurt by an increase. But the increase would hurt smaller competitors of Walmart. this kind of thing is rife in the history of such legislation. Not to mention that federal minimum wage law is blatantly unconstitutional, since there is no enumerated power authorizing Congress to legislate in this area.
Prashanth, see the comments about Rothbard and Kolko here -- http://archive.mises.org/14623/state-antitrust-anti-monopoly-law-versus-state-ip-pro-monopoly-law/ -- it is true that laws like antitrust, minimum wage, pro-union laws, etc., which are normally said to be "against business", actually help big business at the expense of smaller businesses. They help to increase costs for newcomers etc. and entrench oligopolistic entrenched firms. They, like patent and copyright, are anticompetitive. The only true monopoly is the state's, yet the antitrust laws do not apply to them. Antitrust law should be abolished. It is anti-free market. It punishes companies that are too successful, which is ridiculous.
Seems to me like even if the huge statutory damages are consistent with the Due Process of the Vth amendment b/c the statute itself gives "notice" (and was enacted by the Congress by standard "procedures"), you could still argue (a) the awards are excessive in view of the Eighth Amendment, and also (b) violate the first Amendment's freedom of speech/press restrictions. I argue both in http://c4sif.org/2011/11/copyright-is-unconstitutional/
For other absurd arguments for IP, such as "If you oppose IP, you are advocating slavery.", or "If you are not for IP, you must be in favor of pedophilia", or "Thank goodness the Swiss did have a Patent Office. That is where Albert Einstein worked and during his time as a patent examiner came up with his theory of relativity.”, see these and other examples collected at this post: http://c4sif.org/2010/12/absurd-arguments-for-ip/
As for: " This is a discussion about economics, not bigotry. " --well it should be about property rights and justice, not economics. IMHO. People should have secure property rights in their bodies and in other scarce resources that they either homestead or acquire contractually from a previous owner, as a matter of justice and ethics, not economics.
After trying various solutions over the years, including electric razors, wet-dry razors, baby oil or just water, and so on, in recent years I've settled on:
1. Shave Secret, http://www.shavesecret.com/ -- LOVE this stuff. plus
2. Gillette Fusion razor with power-- a little battery in the handle makes the blade vibrate so that the razor just cuts thru whiskers like I've never seen. This combination gives me no irritation and an unltra-smooth shave. Better than anything in the past that I've ever tried.
"What part of history of laws do you get that pearl of wisdom from that "Defamation law is just a type of intellectual property"?"
I have explained this in detail elsewhere. google it. but the bottom line is defamation law assumes you have a property right in your "reputation"--this is not a physical object or scarce resource. This is why it is like patent and copyright.
As usual in such matters: the problem is not "legal bullying." It's the law that is being used to bully. And that law is defamation law (libel and slander). Defamation law is just a type of intellectual property, and is as illegitimate as is patent, copyrgiht, and trademark law. All forms of IP, including libel and slander, should be abolished. They are inherently unjust and unnecessary, and only lead to violation of individual rights, as illustrated here.
This guy's criticism is largely flawed. Let's take his four criticisms:
"As Michael Kanellos pointed out on Forbes yesterday, the agreement has holes.
For instance, Twitter's pledge doesn't apply to any company that's filed its own patent infringement suit in the last 10 years. So even if you're a real company making real products, and you filed a lawsuit to prevent somebody from blatantly ripping off your IP, Twitter reserves the right to sue you first."
So? The solution is to not be a patent aggressor. (Whether you are a troll or not is frankly irrelevant.)
"Another example: the pledge says that Twitter can use the patents offensively to "deter a patent litigation threat." So if Twitter feels threatened, it can sue."
So then don't threaten them with an offensive patent suit
"Twitter's pledge also gives employees -- the actual inventors -- an uncomfortable amount of power. Kanellos lays out a hypothetical situation in which a rip-off company clones Twitter, then bribes a key patent holder to withhold consent so Twitter can't sue."
This is a good point. As I mentioned in my other post, this is the reason that it might be better to grant the contractual right to an independent agency such as a Patent Defense Trust or League, whose core mission is to block offensive use of patents, and which would presumably be un-bribeable.
"Geekwire interviewed three IP experts who agreed that the pledge is full of loopholes. One of them called it "both dumb and disingenuous."
Among other problems: you can't use patents defensively against most trolls, because they don't make any product. By definition they can't possibly violate your patents."
Yes. This is a defect caused by the nature of patent law. Twitter cannot be blamed for this. In fact there is no way to defend against trolls.
I noted above: "Further, the more companies that adopt this approach, the more their own patents become "poisoned" for future trolls, who often just buy their patents from other companies, e.g. those that go bankrupt. The patents from Twitter-type companies would never be able to be used by trolls."
"Many years ago now, my prior venture capital firm, Flatiron Partners, invested in a company called Thinking Media. It was an early Internet company. They developed some browser based javascript tracking technology. The company ulimately failed but was sold in a fire sale including the patents. Those patents eventually made their way to an incumbent, the big marketing research company Nielsen. Fast forward ten years or so and Nielsen sued two of my portfolio companies, comScore and TACODA, and a bunch of other companies too, on the basis of the Thinking Media patents. So IP that was partially funded by our firm was used to sue other portfolio companies. It is so galling to have this kind of thing happen and it is one of the many reasons why I have come to believe that software and business method patents are an enemy of innovation in the tech sector.
If Thinking Media had the patent hack in their documents, the story I just told would not have happened. And thanks to Twitter's leadership, I hope that all future USV portfolio companies will have the patent hack in their documents and stories like that one will be a thing of the past."
I think it won't stop trolls. But with X patents, Twitter is as able to defend itself against competitors suing it (or even trolls suing it) with the X patents, with or without this agreement. So they are no worse off. And they might even get X+Y patents, i.e. extra patents disclosed by a more motivated workforce.
Further, the more companies that adopt this approach, the more their own patents become "poisoned" for future trolls, who often just buy their patents from other companies, e.g. those that go bankrupt. The patents from Twitter-type companies would never be able to be used by trolls.
Further, imagine a world where most companies do this. So then the ONLY lawsuits are those initiated BY trolls. In such a world, the injustice of the patent system would become far more visible and apparent, possibly making meaningful patent reform more viable.
I think this is a brilliant approach. It is not perfect, but here is what I think is going on. If they just issue a policy statement that they will never use them defensively, they can change their minds later (just like legislatures cannot do this-they have parliamentary or legislative sovereignty and can repeal earlier laws). They can't tie their own hands. So they have to give a right to someone else in some way. The inventor is the safest best. Short of forming some trust or other organization (which might be a better solution, but it's more complicated and not as easily replicable by other companies; this one just requires you modify your standard inventor assignment agreement).
So to tie its own hands to prevent itself from suing someone aggressively--they are doing it by contractually giving a veto right to inventors, and assuming they would not want to do this. (Note also the agreement says the inventor will not be coerced or threatened into permitting it.) That also means that it runs with the patent if someone else ever acquires the patent from twitter.
Also, I think it protects the management/board of Twitter from complaints by shareholders--otherwise they might be sued for not acting in the shareholders' best interest if they refuse to sue someone they could extort a billion dollars from, for some "principle" that some managers prefer. This way they can say "well we have no contractual right to--we gave it up previously to the employee-inventors, for purpose of attracting better talent or getting more invention disclosures, a decision protected by the business judgment rule."
I think this is a brilliant approach. It is not perfect, but here is what I think is going on. If they just issue a policy statement that they will never use them defensively, they can change their minds later (just like legislatures cannot do this-they have parliamentary or legislative sovereignty and can repeal earlier laws). They can't tie their own hands. So they have to give a right to someone else in some way. The inventor is the safest best. Short of forming some trust or other organization (which might be a better solution, but it's more complicated and not as easily replicable by other companies; this one just requires you modify your standard inventor assignment agreement).
So to tie its own hands to prevent itself from suing someone aggressively--they are doing it by contractually giving a veto right to inventors, and assuming they would not want to do this. (Note also the agreement says the inventor will not be coerced or threatened into permitting it.) That also means that it runs with the patent if someone else ever acquires the patent from twitter.
Also, I think it protects the management/board of Twitter from complaints by shareholders--otherwise they might be sued for not acting in the shareholders' best interest if they refuse to sue someone they could extort a billion dollars from, for some "principle" that some managers prefer. This way they can say "well we have no contractual right to--we gave it up previously to the employee-inventors, for purpose of attracting better talent or getting more invention disclosures, a decision protected by the business judgment rule."
In the case of a work for hire, the employer (which is usually a company) is the author, under US copyright law. What would happen in the case of automated or animal-based "creation" ... who knows.
Why should the PTO be able to keep all the fees it gets, from exercising the monopoly position the state gives it? Suppose it could charge so that it makes a trillion dollar profit each year. Should it just get to pocket the difference? Pay each employee $1M a year? the costs of the PTO have no connection to the amount of revenue it can extract from the economy. Basically it is a criminal wing of a criminal gang. THey are all extorting money from us.
"The US Congress took a couple of steps in the last 20 years that had huge consequences: 1)they reduced funding for the PTO, causing a salary freeze. Result: the better examiners left. The rest are overworked. 2)they mandated higher fees from applicants. Result: the examiners are beholden to applicants."
I don't think this is right at all. There is no reason, IMO, to think that reducing PTO funding is a cause of what is going on at all. This entire compressed analysis assumes the PTO and state agencies are legitimate, and that PTO examiner "quality" matters at all. It does not. It is completely irrelevant to the problem posed by the patent system. Even if every patent ever granted was superbly written and examined and only "truly non-obvious" patents are granted-the patent system is still a horrible statist monopolistic drag on freedom and the market. PTO competence is utterly irrelevant. Thinking that it matters is just a byproduct of state education and statist thinking.
On the post: Every Successful New Technology Has Created Panic From Those It Disrupts
Re: Re: Re: Re: Re: Re: One disagreement
On the post: Every Successful New Technology Has Created Panic From Those It Disrupts
Re: Re: Re: Re: Re: One disagreement
I don't even know how to respond to this. It is so confused and wrong. I suggest Henry Hazlitt's Economics in One Lesson as a place to start.
On the post: Every Successful New Technology Has Created Panic From Those It Disrupts
Re: Re: Re: One disagreement
"Anti-trust laws, properly formulated, do not punish companies for being too successful. What they do is to prevent those companies from turning financial success into political power that they can use to entrench their position beyond what they could achieve using honest market forces alone."
Think about what you said: it's about preventing them from getting political power. Now this is actually not true--that's not the aim of antitrust law. But if it were, you want to trust the state itself, to enact laws limiting corporate power, to ... prevent corporations from getting state power. Why doesn't the state just pass a law addressing this very issue, instead of using antitrust law as the excuse? The state could limits its own power to be bought by corporations, or limit teh ability of corporations to bribe the state. The solution to the problem that large companies get in bed with the state is to limit the power of the state in the first place, not to hobble companies so that they never become rich or successful enough to have enough money to buy politicians!
"Similarly it is a mistake to see minimum wage and other employee protection laws as helping big business at the expense of small."
It is not a mistake at all; it is reality. Take a look at my previous link where I link to a discussion about Rothbard and Kolko on this. Just b/c state propaganda characterizes its policies a certain way does not mean it is so.
"What these laws should do is to prevent business from exploiting its workforce and then externalising the human cost so that the rest of society has to pick up the pieces. The reason such laws can appear to favour big business over small is not in their essence but rather in the bureaucratic means that are employed to implement them."
This is not true. this is in fact the essence of such laws. Walmart, for example, recently lobbied for an increase in the minimum wage. The reason is walmart already pays its employees above minimum wage. So it would not be hurt by an increase. But the increase would hurt smaller competitors of Walmart. this kind of thing is rife in the history of such legislation. Not to mention that federal minimum wage law is blatantly unconstitutional, since there is no enumerated power authorizing Congress to legislate in this area.
On the post: Get Ready For The Political Fight Against Encryption
Cryptabyte.com
On the post: Every Successful New Technology Has Created Panic From Those It Disrupts
Re: One disagreement
On the post: Obama Administration: $1.5 Million For Sharing 24 Songs Is Perfectly Reasonable
Excessive fines argument
On the post: Filmmaker Compares Copyleft Supporters To Anti-Gay-Marriage Advocates
Justice, not Economics
As for: " This is a discussion about economics, not bigotry. " --well it should be about property rights and justice, not economics. IMHO. People should have secure property rights in their bodies and in other scarce resources that they either homestead or acquire contractually from a previous owner, as a matter of justice and ethics, not economics.
On the post: Do You Owe Your Crappy Shave To Patents?
Shave Secret
1. Shave Secret, http://www.shavesecret.com/ -- LOVE this stuff. plus
2. Gillette Fusion razor with power-- a little battery in the handle makes the blade vibrate so that the razor just cuts thru whiskers like I've never seen. This combination gives me no irritation and an unltra-smooth shave. Better than anything in the past that I've ever tried.
On the post: Blog Fight Devolves Into Legal Nastygrams
Re: Re: IP and Defamation Law are the Problem
I have explained this in detail elsewhere. google it. but the bottom line is defamation law assumes you have a property right in your "reputation"--this is not a physical object or scarce resource. This is why it is like patent and copyright.
On the post: Blog Fight Devolves Into Legal Nastygrams
Re: Re: IP and Defamation Law are the Problem
On the post: Blog Fight Devolves Into Legal Nastygrams
IP and Defamation Law are the Problem
On the post: Twitter's Revolutionary Agreement Lets Original Inventors Stop Patent Trolls
Re: One rebuttal
"As Michael Kanellos pointed out on Forbes yesterday, the agreement has holes.
For instance, Twitter's pledge doesn't apply to any company that's filed its own patent infringement suit in the last 10 years. So even if you're a real company making real products, and you filed a lawsuit to prevent somebody from blatantly ripping off your IP, Twitter reserves the right to sue you first."
So? The solution is to not be a patent aggressor. (Whether you are a troll or not is frankly irrelevant.)
"Another example: the pledge says that Twitter can use the patents offensively to "deter a patent litigation threat." So if Twitter feels threatened, it can sue."
So then don't threaten them with an offensive patent suit
"Twitter's pledge also gives employees -- the actual inventors -- an uncomfortable amount of power. Kanellos lays out a hypothetical situation in which a rip-off company clones Twitter, then bribes a key patent holder to withhold consent so Twitter can't sue."
This is a good point. As I mentioned in my other post, this is the reason that it might be better to grant the contractual right to an independent agency such as a Patent Defense Trust or League, whose core mission is to block offensive use of patents, and which would presumably be un-bribeable.
"Geekwire interviewed three IP experts who agreed that the pledge is full of loopholes. One of them called it "both dumb and disingenuous."
Among other problems: you can't use patents defensively against most trolls, because they don't make any product. By definition they can't possibly violate your patents."
Yes. This is a defect caused by the nature of patent law. Twitter cannot be blamed for this. In fact there is no way to defend against trolls.
On the post: Twitter's Revolutionary Agreement Lets Original Inventors Stop Patent Trolls
Re: Re: What's the point?
Perfect example of this is explained in VC Fred Wilson's post The Twitter "Patent Hack":
"Many years ago now, my prior venture capital firm, Flatiron Partners, invested in a company called Thinking Media. It was an early Internet company. They developed some browser based javascript tracking technology. The company ulimately failed but was sold in a fire sale including the patents. Those patents eventually made their way to an incumbent, the big marketing research company Nielsen. Fast forward ten years or so and Nielsen sued two of my portfolio companies, comScore and TACODA, and a bunch of other companies too, on the basis of the Thinking Media patents. So IP that was partially funded by our firm was used to sue other portfolio companies. It is so galling to have this kind of thing happen and it is one of the many reasons why I have come to believe that software and business method patents are an enemy of innovation in the tech sector.
If Thinking Media had the patent hack in their documents, the story I just told would not have happened. And thanks to Twitter's leadership, I hope that all future USV portfolio companies will have the patent hack in their documents and stories like that one will be a thing of the past."
On the post: Twitter's Revolutionary Agreement Lets Original Inventors Stop Patent Trolls
Re: Follow the money
A better solution might be to set up some kind of Patent Defense League or Trust, an agency granted a contractual right, and has its mission dedicated to opposing patent aggression. I discuss such a possibility in links here: http://c4sif.org/2012/04/twitter-heroically-promises-not-to-use-patents-offensively/
On the post: Twitter's Revolutionary Agreement Lets Original Inventors Stop Patent Trolls
Re: What's the point?
Further, the more companies that adopt this approach, the more their own patents become "poisoned" for future trolls, who often just buy their patents from other companies, e.g. those that go bankrupt. The patents from Twitter-type companies would never be able to be used by trolls.
Further, imagine a world where most companies do this. So then the ONLY lawsuits are those initiated BY trolls. In such a world, the injustice of the patent system would become far more visible and apparent, possibly making meaningful patent reform more viable.
On the post: Twitter's Revolutionary Agreement Lets Original Inventors Stop Patent Trolls
Re: Re: Re: Re: What about existing patent law?
So to tie its own hands to prevent itself from suing someone aggressively--they are doing it by contractually giving a veto right to inventors, and assuming they would not want to do this. (Note also the agreement says the inventor will not be coerced or threatened into permitting it.) That also means that it runs with the patent if someone else ever acquires the patent from twitter.
Also, I think it protects the management/board of Twitter from complaints by shareholders--otherwise they might be sued for not acting in the shareholders' best interest if they refuse to sue someone they could extort a billion dollars from, for some "principle" that some managers prefer. This way they can say "well we have no contractual right to--we gave it up previously to the employee-inventors, for purpose of attracting better talent or getting more invention disclosures, a decision protected by the business judgment rule."
On the post: Twitter's Revolutionary Agreement Lets Original Inventors Stop Patent Trolls
Re: Re: Re: Re: What about existing patent law?
So to tie its own hands to prevent itself from suing someone aggressively--they are doing it by contractually giving a veto right to inventors, and assuming they would not want to do this. (Note also the agreement says the inventor will not be coerced or threatened into permitting it.) That also means that it runs with the patent if someone else ever acquires the patent from twitter.
Also, I think it protects the management/board of Twitter from complaints by shareholders--otherwise they might be sued for not acting in the shareholders' best interest if they refuse to sue someone they could extort a billion dollars from, for some "principle" that some managers prefer. This way they can say "well we have no contractual right to--we gave it up previously to the employee-inventors, for purpose of attracting better talent or getting more invention disclosures, a decision protected by the business judgment rule."
On the post: Can A Company Be An 'Author' For The Purpose Of Copyright?
US law is different
On the post: How The Patent System Is Rigged To Only Expand What's Patentable
Re: Re: blame congress again
On the post: How The Patent System Is Rigged To Only Expand What's Patentable
Re: blame congress again
I don't think this is right at all. There is no reason, IMO, to think that reducing PTO funding is a cause of what is going on at all. This entire compressed analysis assumes the PTO and state agencies are legitimate, and that PTO examiner "quality" matters at all. It does not. It is completely irrelevant to the problem posed by the patent system. Even if every patent ever granted was superbly written and examined and only "truly non-obvious" patents are granted-the patent system is still a horrible statist monopolistic drag on freedom and the market. PTO competence is utterly irrelevant. Thinking that it matters is just a byproduct of state education and statist thinking.
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