Against Intellectual Monopoly

an improvement over the current system.
That speaks volumes about how bad the current system is: mathematicians
call a global minimum a position such that any movement away from it, in
any direction, improves things!
    Also of great significance is the proposal of Gallini and Scotchmer to
allow the independent invention defense to patent claims.21 That is, they would allow proof that an invention was independently derived and not
obtained directly or indirectly as a consequence of a similar invention that
was patented first as a defense against patent infringement. For example,
if you patented the "one click" with the mouse to paste text into a word
processor, and then sued me because my word processor also pasted text
with just one click, I could defend myself by showing that I had written my
word processor in my spare time and had never read your patent or seen a
copy of your word processor. This would not only relieve the innovator from
concern that in his ignorance he would run afoul of some existing patent but
also make it substantially more difficult to engage in submarine warfare, as
the inventor who is torpedoed by the submarine could argue, and prove, that
his invention was independent. This reform, alone, would be of great social
value and would enormously reduce the burden of intellectual monopoly.
As we have illustrated repeatedly, simultaneous or independent inventions
are almost the rule, rather than the exception, and for many great inventions
of the last century - the radio, the television, the airplane, the telephone -
having allowed the two or more independent and simultaneous inventors
to both exploit their invention commercially would have greatly benefited
consumers and economic progress in general. This is even more true and
more relevant today, as the number of judicial disputes over practically
identical and simultaneous innovations skyrocket, especially in the fields of
software, biomedical products, and telecommunications, and for business
practices in general.

    An alternative reform would be to require mandatory licensing at fees
based on estimates of R&D costs. The principle is the following: if it costs
$100 to invent a gadget, 10 percent is a reasonable rate of return on this type
of investment, and expected demand for licensing is on the order of one
hundred units, then a net present value fee of $1.10 would be right. Toss
in an extra $0.05 for the uncertainty and set mandatory licensing at a fee
of $1.15 for this particular patent. William Kingston takes a more serious
look at how this might work in practice, particularly figuring a multiple to
account for the many failed innovations needed to produce a successful one.
Kingston points out that cost estimates are already widely used in patent
litigation and are not so difficult to produce and document. He estimates
that, for most of the cases he studied, the total revenue from licensing
products that are successfully patented and licensed should be about eight
times their R&D cost, if the license is taken immediately; for licenses issued
as the products actually go to market, a multiple of four would be more
appropriate. In the case of pharmaceuticals, he suggests a multiple of two
would be sufficient, noting, "If three such licenses were taken, the payments would [already] put the product into the most profitable decile (the home
of the blockbuster drugs)."22

    A backdoor to reducing the term of patent, and making it less easy to
accidentally run afoul of long-standing but meaningless patents, would be to
reintroduce patent renewal - for example, keeping the term of patent fixed
while splitting the twenty-year term into smaller increments, with a renewal
required at each stage. This is discussed by Cornelli and Schankerman and
by Scotchmer.23
    In copyright, the most immediate problem is that of a Congress and
Supreme Court that are "bought and paid for." Sorry, but after reading both
the congressional hearings on the DMCA and the Supreme Court decision
in Eldred' either they are bought and paid for or we have a dramatic case
of total IQs dropping to the double-digit level.24 The triple whammy of
giving automatic copyright to every work, whether or not it is registered,
eliminating the need for renewal, and extending the term of copyright to be
essentially infinite means that, over time, virtually everything written will
become inaccessible. Lessig, among others, documents in great