IAM_52 Paginated - 1 25/01/2012 14:29 Page 46

The intangible investor

Written by Bruce Berman The imperfect storm

A new wave of anti-IP rhetoric is angrier have made collecting tolls appear inherently Party won 7.1% of the vote in Sweden’s and uglier than ever. Figuring out who is unfair, like taxing the air. elections and won two fuelling it and why is not that difficult. Not in decades have people felt so of Sweden’s 18 European Parliament seats. Overcoming the negative impact is removed from those in government and In 2010 the Pirate Parties International was business. Frustration is growing about founded in Brussels at the PPI Conference. Patent and copyright holders that enforce economic control and IP rights, never In September 2011 in the Berlin state their rights are making a lot of people angry. beloved, are in the middle of a bloody battle elections the won 8.9% of the The convergence of increased competition, in which millions believe that their personal vote and 15 seats in a state parliament. blighted economies and misinformation is freedom is at stake. As James Naughton in The Guardian unleashing a new wave of vitriol directed From an anti-IP perspective, there is reported: “It isn’t often that a towards IP rights and owners which is more plenty to complain about: the high cost of takes a relaxed view of file sharing, advocates dangerous than it may appear. Holders and obtaining and defending patents; trolls which radical reform of laws, managers who are focused on maintaining are often depicted as blood-sucking parasites; opposes state surveillance in all its forms, their IP rights many also want to think about patent sales, such as Nortel’s US$4.5 billion evangelises about open source, and then has exercising their First Amendment ones. auction dominated by cash-laden tech giants; electoral success in the real world.” The perfect IP storm is about to make and IP doubters including economists and law Managers and technology investors landfall. Those already dubious about the professors such as James Bessen, Michael cannot afford to be complacent about IP use of patents and other rights see an Meurer, Josh Lerner, Michael Lerner and rights. They were hard won and, if recent opportunity to cut them down further. Lawrence Lessig, who don’t believe that events are any indication, they will be Inducing broad audiences to see IP as intellectual assets should be treated like other difficult to retain. Those who believe that IP casually issued monopolies in the best property. They would sooner see patents continues to contribute positively to society interests of a few is getting easier and, seriously weakened, if not eliminated, and need to be more explicit about where and worse still, somewhat fashionable. invention licensing compulsory. how. An increasing number of people want Technology and business media are The wide and generally blind acceptance to see IP rights and their enforcement joining with political organisations, some (Washington Post, et al) of Bessen, Ford and demonised. They believe they are by- tech businesses, law makers and an Meurer’s working paper, “The Private and products of government control and special increasing number of academicians to Social Costs of Patent Trolls”, is particularly interests, and limit freedom and social challenge IP. Disdain for patents and troubling. In this study they argue that non- welfare. Unheard are the voices of those copyrights is not new. Its political practising entities (NPEs) are really patent who know that the IP system, while correctness is. Nurtured by half-truths trolls “who opportunistically litigate over imperfect, is inclusive and effective. about IP abusers locking out competitors software patents with unpredictable Driving a stake through the heart of IP and shaking down businesses, many people boundaries”, and are responsible for serious rights will not put innovation disputes to believe that intellectual assets impede social and economic damage. Using stock rest or give file sharers what they desire. innovation and represent privilege; they are market “event studies” around patent However, with numbers on their side and akin to bank bailouts and inflated CEO lawsuit filings, the authors claim that NPEs the world economy in turmoil, IP naysayers compensation. Having been dealt stiff body were associated with half a trillion dollars of are in a good position to gain a foothold. blows by the courts and recent legislation, lost wealth from 1990 through 2010. Any one of these developments – the IP is on the ropes. Of greater concern than Bessen, et al acknowledge that their work passage of the America Invents Act and naysayers are IP managers and attorneys received support from the (ironically named) weakening of patents, the growth of Pirate who know better, but remain silent. Coalition for Patent Fairness and research Parties, anti-troll trash talk and the global Occupy Wall Street, the Arab spring, assistance from PatentFreedom. Both of these Occupy movement – would not have so Russian unrest at the election polls and the groups are in turn supported by significant much impact. Taken collectively, they are ascendance of multiple Pirate Parties have patent holders, fearful of more assertive ones. a force to be reckoned with. raised suspicions about power and control. Another serious concern is the rapid Faster access to more information has of self-proclaimed Pirate Parties, which changed the way that people view in just a few years have been established in ownership. You turn on the tap and water more than 40 countries. Bruce Berman is CEO of Brody Berman comes out. Only expensive restaurants have The first Pirate Party was the Swedish Associates, a strategic communications firm the audacity to charge for it. You turn on Piratpartiet, founded in 2006. Other parties that advises IP holders, managers and service your computer and data streams emerge, and groups have been formed in Austria, providers. Opinions expressed here are his, embodied by content, such as music and Denmark, Finland, Germany, and the not Brody Berman’s. For links to reports images. Ease of access and broad adoption Netherlands. In 2009 the original Pirate mentioned in this article, visit IP CloseUp

46 Intellectual Asset Management March/April 2012 www.iam-magazine.com