Legal Issues - Intellectual Property

INTELLECTUAL PROPERTY

Intellectual property (IP)—inventions, artistic creations, and commercial symbols, for example—falls under the branch of law covering protections and rights such as copyrights, patents, trademarks, and trade secrets. Ideally, IP laws balance the rights holder's ability to derive profit from creations with society's interest in the free flow of information. However, the Internet makes it possible to generate numerous, flawless reproductions of digitized information and instantaneously transmit those copies anywhere in the world. This imperils the ability of the rights holder to control how and by whom that information is used. However, erecting stricter protections around intellectual property rights (through, for example, encryption or licensing requirements) might stifle both creative expression and commercial innovation. Copyright and trademark form the nucleus of contested cyberspace-related intellectual property issues.

The U.S. Constitution grants Congress the power to regulate copyright. The basic statute is the Copyright Act of 1976, which protects traditional creative works and online text, image, and sound files. Copyright violations can be prosecuted as civil or criminal offenses, depending on the circumstances, and those committing unintentional or contributory infringement may also incur liability. Subsequent legislation directly addressing copyright in cyberspace included the Copyright Felony Act (1992), which addressed software piracy as a felony; the Digital Performance Right Act (1996), governing inclusion of non-original music on Web sites; the No Electronic Theft Act (1997), which abolished the requirement that a violation had to be committed for financial gain in order to be prosecutable; and the Digital Millennium Copyright Act (1998), which harmonized American copyright law with international law as embodied in the World Intellectual Property Organization's Copyright Treaty. Among other things, DMCA prohibits the circumvention of technology used to block unauthorized access to protected digital content.

In the U.S., the states also regulate copyright. In particular, the Uniform Computer Information Transactions Act (USCITA), introduced in 1999, was adopted by Virginia and Maryland and was under consideration in many other states in the early 2000s. It strictly limits permitted ("fair") free use of copyrighted digital materials, and has been opposed by many groups who fear it could erase copyright exceptions that currently permit unauthorized use of works for scholarly, news, and critical purposes.

Within trademark law, the intellectual-property status of domain names emerged as the leading cyberlaw dilemma. The practice of "cyber-squatting," the bad-faith registration of domain names in the hopes that the namesake will later purchase the name back, spurred new guidelines for registration of domain names. WIPO implemented a swift arbitration procedure to handle international domain-name disputes.

Many international treaties govern IP, including the Berne Convention, the WIPO Copyright Treaty, and the Trade-Related Aspects of Intellectual Property Rights (TRIPs) Agreement. Most industrialized nations provide stronger IP protections than the U.S. Experts predict that e-commerce, globalization, and IP piracy will prompt increased standardization of international IP laws, perhaps at the expense of developing nations.