Fair Use and the Future Explored: Chip N' Dale: Rescue Rangers Movie

Yesterday, my kids and I watched the new movie, Chip N’ Dale:Rescue Rangers.  This is probably the funniest Intellectual Property law related movie I’ve seen.  Disney takes on IP Law doctrine and policy in a very humorous way.  As an exercise in understanding U.S. IP law, the facts the movie raises are very nice.  Here’s a few examples: ET v. Batman; Ugly Sonic; Chippendales; and on and on.  They also take on: a glimpse at the future of augmented reality; artificial intelligence and creativity; culture wars; Hollywood nostalgia reboots (talk about bootlegging); and the future of counterfeiting. There are so many references my brain almost exploded from overload. As a tip, be sure to take in the background materials, e.g., advertisements. Lol. They take some pretty nice shots at competitors, but I wonder what’s going to come back.  Interestingly, the Pirates of the Caribbean ride at Disneyland has been closed for “refurbishment.”  [In full disclosure, I am a very big fan of Disney and may be extremely biased.]

White Hat Hackers Safe from CFAA Prosecution?

The U.S. Department of Justice announced yesterday that it will not prosecute white hat researchers under the Computer Fraud and Abuse Act!  However, white hat hackers beware: There are many state laws that criminalize such behavior.  The press release states:

The Department of Justice today announced the revision of its policy regarding charging violations of the Computer Fraud and Abuse Act (CFAA). 

The policy for the first time directs that good-faith security research should not be charged. Good faith security research means accessing a computer solely for purposes of good-faith testing, investigation, and/or correction of a security flaw or vulnerability, where such activity is carried out in a manner designed to avoid any harm to individuals or the public, and where the information derived from the activity is used primarily to promote the security or safety of the class of devices, machines, or online services to which the accessed computer belongs, or those who use such devices, machines, or online services. 

“Computer security research is a key driver of improved cybersecurity,” said Deputy Attorney General Lisa O. Monaco. “The department has never been interested in prosecuting good-faith computer security research as a crime, and today’s announcement promotes cybersecurity by providing clarity for good-faith security researchers who root out vulnerabilities for the common good.”

The new policy states explicitly the longstanding practice that “the department’s goals for CFAA enforcement are to promote privacy and cybersecurity by upholding the legal right of individuals, network owners, operators, and other persons to ensure the confidentiality, integrity, and availability of information stored in their information systems.” Accordingly, the policy clarifies that hypothetical CFAA violations that have concerned some courts and commentators are not to be charged. Embellishing an online dating profile contrary to the terms of service of the dating website; creating fictional accounts on hiring, housing, or rental websites; using a pseudonym on a social networking site that prohibits them; checking sports scores at work; paying bills at work; or violating an access restriction contained in a term of service are not themselves sufficient to warrant federal criminal charges. The policy focuses the department’s resources on cases where a defendant is either not authorized at all to access a computer or was authorized to access one part of a computer — such as one email account — and, despite knowing about that restriction, accessed a part of the computer to which his authorized access did not extend, such as other users’ emails.

However, the new policy acknowledges that claiming to be conducting security research is not a free pass for those acting in bad faith. For example, discovering vulnerabilities in devices in order to extort their owners, even if claimed as “research,” is not in good faith. The policy advises prosecutors to consult with the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) about specific applications of this factor. 

All federal prosecutors who wish to charge cases under the Computer Fraud and Abuse Act are required to follow the new policy, and to consult with CCIPS before bringing any charges. Prosecutors must inform the Deputy Attorney General (DAG), and in some cases receive approval from the DAG, before charging a CFAA case if CCIPS recommends against it. 

The new policy replaces an earlier policy that was issued in 2014, and takes effect immediately.

How Europe can build on strengths in SEPs to reclaim leadership in cellular with 5G and 6G

 The EU is in grave danger of “throwing out the baby with the bathwater” in its prospective attempts to reform SEP licensing with interventions for the purported benefit of European Small and Medium-Sized Enterprises (SMEs) in IoT. 

Europe was once preeminent in cellular communications with 2G GSM—including standard-essential technology innovation, product developments and sales, network deployments, and operator services adoption by consumers. Since its heyday in the in the late 1990s, Europe has declined through a succession of falls from various leading positions in cellular.

Revenue growth captured in cellular by newcomers from outside Europe

Source: Companies’ yearend reports and average annual exchange rate figures

The European Commission’s initiatives to regulate standard essential patents (SEPs)—most significantly in cellular technologies and ostensibly for the benefit of SMEs and other technology implementers—are oblivious to this bigger picture. It is vital for all Europeans that the region’s remaining major players in the cellular ecosystem can flourish profitably and are able to continue investing in R&D for innovation, new products, network deployments and services growth. That means ensuring standard-essential technology developers including the European Union’s Ericsson and Nokia can make fair and adequate returns on their SEP investments. The SEP licensing system needs to be reinforced, not weakened with prospective interventions that are inconsistent, contradictory or that have weak factual justification and would jeopardise Europe’s competitiveness.

Re-establishing European strength in cellular also requires reregulation of operator and other services markets so that European mobile network operators can become profitable leaders in the mobile ecosystem once again. Hopefully the EU’s new Digital Markets Act (DMA) that seeks to reign-in the dominant and abusive behaviour of Big Tech companies such as Apple, Alphabet and Meta will help European mobile operators and others improve their competitive positions and abilities to become leaders rather than remain followers with new technologies and services. Anticipated measures against these Big Tech “gatekeepers” include restrictions on bundling and self-preferencing between complementary services (e.g. search versus shopping), and mandating interoperability among different messaging platforms. 

The European Commission, with its call for evidence for an Impact Assessment regarding a new framework for standard-essential patents closing May 9, 2022, follows the US Department of Justice and the UK’s Intellectual Property Office with public consultations on the topic of SEP licensing. These focus on various issues including improved “transparency” with the counting of essentiality-checked patents in setting royalty rates, prospective new collective licensing arrangements and purported problems such as opportunistic behaviour by patent owners and implementers.

While the European Commission threatens to meddle with SEP licensing, a paper I have written for 4iP Council considers the broader strategic issues on Europe’s competitiveness in cellular. This longer read shows that virtually all the $14 billion in SEP royalties to Europe’s world-leading innovators Ericsson and Nokia over the last 5 years— that were vital to fund their R&D at a total cost of around $10 billion in 2021—were export revenues generated on smartphone sales by Apple and Asian OEMs. Royalties generated from SEPs in Europe are tiny in comparison: most IoT modules are produced by a top five manufacturers that are Chinese, and there is no requirement for software application developers to take SEP licenses. 

Licensing costs pale in comparison to total revenues and profits derived as the cellular ecosystem expands to be worth many trillions of dollars in products, services and applications including IoT.

This summary article was originally Published in RCR Wireless on 4th May 2022.

Women and the Unified Patent Court - Free Webinar hosted by OxFirst April 28 3 p.m. UK time

 Date & Time:  April 28 2022 15h00 -16h00 GMT = 16.00 – 17.00 CET

 The Influence of Women in IP: Women and the Unified Patent Court.

What the Panel Discussion is About

The establishment of the Unified Patent Court is likely the biggest game changer in European patent system. But what role and influence will women play in shaping this new Court?

Should under the UPC the opportunities for women be stronger established? Should women judges, given equal qualification and competence, be given priority in the selection process? Should there be adjustments made to allow judges who are also parents to participate in the UPC?

And, is there a need to come to grips with more gender-neutral language under the UPC?

This panel addresses these and more questions relating to women in IP and asks what can be done to remove gender barriers in intellectual property.

About the Speakers

Marina Tavassi has until most recently been the President of the Milan Court of Appeal. She has been a judge in Italy for over 40 years (specialized in IP) and sat on Samsung vs Apple, Italy. Since June 2014, she has also been a member of the panel of experts responsible for drafting rules of procedure for European Unitary Patent Court. She has also been a national judge on the Enlarged Board of Appeal of the European Patent Office (based in Munich). She is of counsel with BonelliErede.

 

Julia Dias is Senior IP Policy Counsel for Huawei. Julia specialises in SEP/FRAND licensing, litigation and policy. She is also the Vice Chair of the IPR working group of Digital Europe. Prior to joining Huawei, Julia gained IP experience in the UK and in Germany, including at the EPO where she worked in various ICT projects focusing on SEPs and emerging technologies. 

                                                                                                              

Katie Colart Katie is a partner in the London IP litigation team at Kirkland & Ellis. Katie specialises predominantly in patent litigation across a range of sectors including life sciences and tech. Katie regularly deals with major cross-border disputes of significant strategic importance to her clients and is ranked as an “Up and Coming” lawyer by Chambers, and a “Next Generation Partner” by The Legal 500.

How to Join:

https://oxfirst.com/webinars/the-influence-of-women-in-ip-women-and-the-unified-patent-court/

After registering, you will receive a confirmation email containing information about joining the webinar.

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Google: Investing in Education . . .

Google recently released some interesting information concerning its economic impact in the United States.  It is very impressive.  Google released its Economic Impact Report for 2021 and announced its investment of over $9.5 billion in U.S. Offices and data centers.  Notably, Google states in a blog post:

Google’s offices and data centers provide vital anchors to our local communities and help us contribute to their economies. In the U.S., over the past five years, we’ve invested more than $37 billion in our offices and data centers in 26 states, creating over 40,000 full-time jobs. That’s in addition to the more than $40 billion in research and development we invested in the U.S. in 2020 and 2021.

Google also notes that:

Today we are also releasing our 2021 Economic Impact Report, which reflects Google’s wider contribution to the economy. The report shows we helped provide $617 billion in economic activity for millions of American businesses, nonprofits, creators, developers and publishers last year. In addition, the Android app economy helped create nearly two million jobs last year, and YouTube’s creative ecosystem supported 394,000 jobs in 2020.

We also continue to help people get the skills they need to succeed in today’s economy, from our role as a founding member of the Michigan Central innovation district in Detroit to our $100 million Google Career Certificates Fund — a new financial model for helping people access education and digital skills.

The Google Career Certificates programs and Fund is an ambitious project:

The goal is to enable Social Finance to reach more than 20,000 American workers. This investment in America’s future has the potential to drive $1 billion in wage gains.

This fund is a new kind of financing model. We’ll invest Google capital and Google.org grants and provide our Career Certificate program. Social Finance will provide funding to nonprofit partners like Merit America and Year Up, who in turn will provide services like career coaching, living stipends and job placement support. And we’ll connect students to an employer consortium of more than 150 companies who are looking to hire workers with these skills.

It’s all designed around student success. They will receive all of this at no upfront cost. And will only pay it back once they find a job earning at least $40,000 a year. Social Finance will then redistribute those repayments to future learners, making this model more sustainable.

U.S. Congressional Research Service Report on Potential COVID-19 IP Rights Waiver

The Congressional Research Service has released a report for the U.S. Congress concerning the COVID-19 Patent Waiver agreement between the U.S., India, South Africa and the EU.  The report discusses the leaked agreement and outlines specific issues for the U.S. Congress to consider:

Key issues include · Should more congressional input or approval be required before the Administration could agree to modifying TRIPS obligations (as proposed in some pending bills)? · How would the proposed agreement affect innovation incentives for COVID-19 vaccines and other treatments? What would it mean for U.S. competitiveness vìs-a-vìs China, which poses major IPR theft challenges? · How would the proposed agreement affect global COVID-19 vaccine production and access? Would any boost occur quickly enough to respond to the pandemic’s current stage, or be more relevant to respond to potential future variants? What does the proposed agreement mean for future pandemic responses? · Is the U.S. position on this waiver particular to COVID-19 or a general policy shift as it relates to historical U.S. positions in advancing IPR in trade agreements? How may these issues shape potential debate on Trade Promotion Authority renewal and U.S. IPR trade negotiating objectives? · What would a timely COVID-19 IPR outcome—or its absence—mean for debates about the WTO’s relevance in the changing global economy?

The report is available, here. 

Global Detroit Entrepreneur in Residence Program

Global Detroit is a very interesting organization which is basically focused on economic development in Michigan and the general Detroit area.  Detroit has struggled economically.  Notably, Global Detroit has an Entrepreneur in Residence program which focuses on bringing foreign born entrepreneurs and their companies to Detroit/Michigan through working at a host university as a mentor.  Here is a success story:

Ashok Seetharam was living in Milwaukee when his startup, PAXAFE, began to take off. But he wasn’t sure he’d be able to stay. PAXAFE was Ashok’s third startup. After moving to the U.S. from India and graduating from Brown University with a graduate degree in Biomedical Engineering, he co-founded Orthopedix and led the company through XlerateHealth, an early-stage healthcare accelerator program. Orthopedix ultimately licensed its patented technology to a major orthopedic implant manufacturer. Next, he oversaw product development and a team of engineers for another healthcare startup, Toggle Health. 

In late 2018, Ashok and Ilya Preston founded PAXAFE in Milwaukee. Ilya’s family immigrated from Russia when he was a child. He and Ashok met at XlerateHealth in 2017. They originally helped kickstart a Minnesota startup focused on the transport of medical specimens, but ended up parting ways to start their own company. PAXAFE develops hardware and software IoT solutions that enable cheaper, intelligent shipping insurance. 

International startup founders face major challenges to launching their companies in the U.S. To remain in the country, they typically need an H-1B visa, which is available to foreign-born “specialty workers” in specific, largely high-tech fields. Ashok was permitted to remain in the U.S. for a short time on a different visa following his graduation from Brown, but he needed an H-1B visa to stay.

Fortunately for Ashok, in late 2018 Global Detroit launched a program called Global EIR. A partnership with the national Global EIR program, the program places foreign-born startup founders at universities to teach and mentor. By working at the university, Global EIRs are able to legally work in the US. This affords them the opportunity to launch their startups here and apply for a concurrent H-1B through their company. Global Detroit currently partners with the University of Michigan’s Economic Growth Institute on the program. Ashok was accepted, and PAXAFE moved their headquarters to Ann Arbor last summer. The company has recently closed on an additional $650,000 round of pre-seed funding, bringing their total raised in 2019 to almost $1 million. Working out of Ann Arbor SPARK, they have begun piloting their product and hiring for new positions.

“I didn’t think it was possible to continue building my company in the U.S. when I didn’t make the H-1B lottery,” Ashok recalls. “That all changed when I learned about Global Detroit and Global EIR. Not only did they help with my immigration through the Global EIR program but also continued to provide unparalleled support– both personally and with the business–which maximized our chance of success.”

TRIPS Waiver Compromise on COVID-19 Vaccines and Treatments Announcement Coming Soon?

The AIPLA and other IP organizations have issued a joint statement on a tentative TRIPS waiver compromise. On March 15, 2022, Adam Hodge, USTR spokesperson stated, in part:

Since last May, USTR has worked hard to facilitate an outcome on intellectual property that can achieve consensus across the 164 Members of the World Trade Organization to help end the pandemic. USTR joined informal discussions led by the WTO Secretariat with South Africa, India, and the European Union (EU) to try to break the deadlock.

The difficult and protracted process has resulted in a compromise outcome that offers the most promising path toward achieving a concrete and meaningful outcome. While no agreement on text has been reached and we are in the process of consulting on the outcome, the U.S. will continue to engage with WTO Members as part of the Biden-Harris Administration’s comprehensive effort to get as many safe and effective vaccines to as many people as fast as possible.

I wonder how Russia's invasion of Ukraine impacted the consensus building.  The Joint Statement provides:

JOINT STATEMENT ON TENTATIVE TRIPS WAIVER COMPROMISE

Written March 28, 2022

On March 24, AIPLA, along with the Intellectual Property Owners Association (IPO), Licensing Executives Society International (LESI), Licensing Executives Society USA & Canada, and the New York Intellectual Property Law Association (NYIPLA) issued a joint statement on the tentative TRIPs Waiver Compromise.  Our organizations are concerned by reports that the European Union, India, South Africa, and the United States have reached a tentative compromise on a proposed TRIPS waiver of intellectual property (IP) rights. We strongly support equitable, widespread and successful distribution of vaccines necessary to meet the challenges of COVID-19. However, the proposal currently being reported incorrectly portrays IP as a barrier to production and supply of COVID-19 vaccines. Our organizations know of no evidence to support that IP is such a barrier. In fact, the World Health Organization has stated: “[w]ith global vaccine production now at nearly 1.5 billion doses per month, there is enough supply to achieve our targets, provided they are distributed equitably. This is not a supply problem; it’s an allocation problem.”1 Solving the allocation problem is best accomplished by focusing on improvements to supply chain and distribution issues, rather than by concentrating on the red herring of intellectual property as an alleged barrier. Intellectual property has been critical to the development of technology that has enabled a global COVID-19 response and it continues to fuel efforts to more effectively distribute vaccines and advance other needed technology. We should not undermine our ability to respond to this and future pandemics.

Footnote 1:  See https://www.who.int/campaigns/vaccine-equity (accessed on 18 March 2022).

Global Recorded Music Industry Doing Quite Well

The IFPI has released a report titled, “Global Music Report 2021.”  The Report reviews the revenues for the global recorded music industry.  The news is good with streaming paving the way for an increase in revenue even with COVID-19!  The press release states:

The global recorded music market grew by 7.4% in 2020, the sixth consecutive year of growth, according to IFPI, the organisation that represents the recorded music industry worldwide. Figures released today in IFPI’s Global Music Report show total revenues for 2020 were US$21.6 billion.

Growth was driven by streaming, especially by paid subscription streaming revenues, which increased by 18.5%. There were 443 million users of paid subscription accounts at the end of 2020. Total streaming (including both paid subscription and advertising-supported) grew 19.9% and reached $13.4 billion, or 62.1% of total global recorded music revenues. The growth in streaming revenues more than offset the decline in other formats’ revenues, including physical revenues which declined 4.7%; and revenues from performance rights which declined 10.1% – largely as a result of the COVID-19 pandemic.

I couldn’t agree more with the statement by the IFPI Chief Executive Frances Moore:

“As the world contends with the COVID-19 pandemic, we are reminded of the enduring power of music to console, heal and lift our spirits.

Some things are timeless, like the power of a great song or the connection between artists and fans. But some things have changed. With so much of the world in lockdown and live music shut down, in nearly every corner of the globe most fans enjoyed music via streaming.” 

And, the whole world was happier with music:

·       Latin America maintained its position as the fastest-growing region globally (15.9%) as streaming revenues grew by 30.2% and accounted for 84.1% of the region’s total revenues.

·       Asia grew 9.5% and digital revenues surpassed a 50% share of the region’s total revenues, for the first time. Excluding Japan (which saw a decline of 2.1% in revenue), Asia would have been the fastest-growing region, with exceptional growth of 29.9%

·       Featured as a region in the report for the first time, recorded music revenues in the Africa & Middle East region increased by 8.4%, driven primarily by the Middle East & North Africa region (37.8%). Streaming dominated, with revenues up 36.4%.

·       Revenues in Europe, the second-largest recorded music region in the world, grew by 3.5% as strong streaming growth of 20.7% offset declines in all other consumption formats.

·       The US & Canada region grew 7.4% in 2020. The USmarket grew by 7.3% and Canadian recorded music revenues grew by 8.1%.