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Intellectual Property

Ahead of Visit, U.S. Senators Petition China’s Vice Premier on Intellectual Property, Indigenous Innovation, and Beef

A bipartisan group of U.S. senators on Monday asked China’s Vice Premier Wang Qishan to resolve several “longstanding irritants to the U.S.-China economic relationship” ahead of the Chinese dignatory’s visit next week to participate in an annual trade summit in Washington D.C.

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Chinese Vice Premier Wang Qishan (center) with U.S. President Barack Obama at the White House July 2009. Wang was there to discuss the results of the first U.S.-China Strategic and Economic Dialogue.

A bipartisan group of U.S. senators on Monday asked China’s Vice Premier Wang Qishan to resolve several “longstanding irritants to the U.S.-China economic relationship” ahead of the Chinese dignatory’s visit next week to participate in an annual trade summit in Washington D.C.

The senators in particular complained that China is not enforcing intellectual property rights as stringently as it could be, and that U.S. companies are being blocked from the China market by protectionist “indigenous innovation” policies.

The senators, led by Senate Finance Committee Chairman Max Baucus, D-Mont. and ranking member Chuck Grassley, R-Iowa, urged the Chinese government to make good on its 2006 commitment to ensure that all of its staff use legally-bought software instead of pirated copies.

The bipartisan group also called the Chinese out about their ongoing efforts to promote “indigenous innovation” at the expense of U.S. companies.

Chinese officials over the past few years have expressed concern about becoming too reliant on foreign technologies, and have made a concerted push to be self-reliant.

“We fully respect and encourage China’s efforts to build a robust domestic innovative sector, but to be successful, China must engage in these efforts without explicitly or implicitly discriminating against U.S. companies,” the senators wrote. “Discrimination will deter collaboration with, and investments from cutting-edge American innovators that can help build China’s own innovative sector.”

The senators also noted that the Chinese are still blocking beef imports.

They authored the letter a week ahead of a visit to Washington, D.C. by Wang, the unflappable, straight-shooting 62-year-old former mayor of Beijing.

He is scheduled to participate in an annual trade summit with the United States called the U.S.-China Joint Commission on Commerce and Trade. Wang will meet with both U.S. Commerce Secretary Gary Locke, U.S. Trade Representative Ron Kirk and Agriculture Secretary Tom Vilsack.

The joint commission was created in 1983 for both countries to iron out trade disputes and to explore commercial opportunities. Last year’s meeting took place in Hangzhou, China.

Last month, U.S. trade officials said that they are investigating whether China’s support of its clean energy sector is a violation of World Trade Organization rules.

Last year, Chinese officials promised to remove the requirement that 70 percent of wind turbine equipment be sourced from domestic manufacturers.

China followed up on that promise this January, but then the following month two departments in President Hu Jintao’s administration’s promulgated new rules that said that only majority-owned Chinese companies could participate in China’s offshore wind market.

“In most cases, it’s just a matter of China treating U.S. companies fairly,” said Grassley in a statement issued Thursday. “For example, China has policies that give preferences to wind turbines built in China. That puts Iowa’s wind turbine manufacturers at a disadvantage.”

In October testimony about China’s trade policies, John Frisbie, the U.S.-China Business Council’s president, also noted that U.S. clean energy companies are discriminated against in China because the government inevitably chooses the cheapest products even though U.S. products might be more efficient and higher quality.

China’s efforts to boost its new energy vehicle industry is also troubling, Frisbie said.

Draft regulations would require foreign auto makers to share their new energy vehicle technologies with their joint venture partners so that the locals can receive a “mastery” designation with the technology.

It is commonplace for companies that share their intellectual property in China to be copied and then undercut, as a Monday story in the Wall Street Journal concerning Russian fighter jets shows.

Technology companies from around the world who have set up shop in China are frequently in litigation over the issue.

A November report issued by the U.S. China Economic and Security Review Commission found that China had not lived up to the commitments it made when it joined the World Trade Organization.

“The 2010 annual report reflects the commission’s conclusions that China has failed to fulfill the promises it made nine years ago when it joined the World Trade Organization,” said the commission’s Chairman Dan Slane when it issued the report mid-November.

“Specifically, China is adopting a highly discriminatory policy of favoring domestic producers over foreign manufacturers,” he added. “Under the guise of fostering ‘indigenous innovation’ in its economy, the government of China appears determined to exclude foreigners from bidding on government contracts at the central, provincial and local levels. In addition, China has proposed that its many state-owned corporations be exempt from WTO rules on procurement. The Chinese government quite similarly intends to wall off a majority of the economy from international competition.”

Both Baucus and Grassley charged the U.S. International Trade Commission this April with investigating the economic impact of China’s perceived lackluster intellectual property enforcement efforts and its indigenous innovation policies on the U.S.. The first report is due to be published sometime mid-December after Wang’s visit.

In their Monday letter, the U.S. senators urged the commission to resolve these issues ahead of Chinese President Hu Jintao’s visit to the United States next month.

Photo: Pete Souza, the White House.

Broadband Breakfast is a decade-old news organization based in Washington that is building a community of interest around broadband policy and internet technology, with a particular focus on better broadband infrastructure, the politics of privacy and the regulation of social media. Learn more about Broadband Breakfast.

Copyright

Public Knowledge Celebrates 20 Years of Helping Congress Get a Clue on Digital Rights

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Screenshot of Gigi Sohn from Public Knowledge's 20th anniversary event

February 27, 2021 – The non-profit advocacy group Public Knowledge celebrated its twentieth anniversary year in a Monday event revolving around the issues that the group has made its hallmark: Copyright, open standards and other digital rights issues.

Group Founder Gigi Sohn, now a Benton Institute for Broadband and Society senior fellow and public advocate, said that through her professional relationship with Laurie Racine, now president of Racine Strategy, that she became “appointed and anointed” to help start the interest group.

Together with David Bollier, who also had worked on public interest projects in broadcast media with Sohn, and is now director of Reinventing the Commons program at the Schumacher Center for a New Economics, the two cofounded a small and scrappy Public Knowledge that has become a non-profit powerhouse.

The secret sauce? Timing, which couldn’t have been better, said Sohn. Being given free office space at DuPont Circle at the New America Foundation by Steve Clemmons and the late Ted Halstead, then head of the foundation, was instrumental in Public Knowledge’s launch.

The cofounders met with major challenges, Sohn and others said. The nationwide tragedy of September 11, 2001, occurred weeks after its official founding. The group continued their advocacy of what was then more commonly known as “open source,” a related grandparent to the new “net neutrality” of today, she said.

In the aftermath of September 11, a bill by the late Sen. Ernest “Fritz” Hollings, D-S.C., demonstrated a bid by large copyright interest to force technology companies to effectively be the copyright police. Additional copyright maximalist measures we launched almost every month, she said.

Public Knowledge grew into something larger than was probably imagined by the three co-founders. Still, they shared setbacks and losses that accompanied their successes and wins.

“We would form alliances with anybody, which meant that sometimes we sided with internet service providers [on issues like copyright] and sometimes we were against them [on issues like telecom],” said Sohn. An ingredient in the interest group’s success was its desire to work with everyone.

Congress didn’t have a clue on digital rights

What drove the trio together was a shared view that “Congress had no vision for the future of the internet,” explained Sohn.

Much of our early work was spend explaining how digitation works to Congress, she said. The 2000s were a time of great activity and massive growth in the digital industry and lawmakers at the Hill were not acquainted well with screens, computers, and the internet. They took on the role of explaining to members of Congress what the interests of their constituents were when it came to digitization.

Public Knowledge helped popularize digital issues and by “walking [digital information] across the street to [Capitol Hill] at the time created an operational reality with digitization,” said Bollier.

Racine remarked about the influence Linux software maker Red Hat had during its 2002 initial public offering. She said the founders of Red Hat pushed open source beyond a business model and into a philosophy in ways that hadn’t been done before.

During the early days of Public Knowledge, all sorts of legacy tech was being rolled out. Apple’s iTunes, Windows XP, and the first Xbox launched. Nokia and Sony were the leaders in cellphones at the time, augmenting the rise of technology in the coming digital age.

Racine said consumers needed someone in Washington who could represent their interests amid the new software and hardware and embrace the idea of open source technologies for the future.

Also speaking at the event was Public Knowledge CEO Chris Lewis, who said Public Knowledge was at the forefront of new technology issues as it was already holding 3D printing symposiums before Congress, something totally unfamiliar at the time.

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Intellectual Property

U.S. and EU Privacy and Intellectual Property Landscape Complicate Data Use Requirements

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Photo of Lee Tiedrich in February 2020 from the Regulatory Review on Twitter

February 7, 2021 – Differences in the intellectual property and privacy landscape between Europe and the United States account are among the forces complicating the regulatory landscape around commercial data, partners at Covington’s Second Annual Technology Forum said on January 27.

Further, because intellectual property laws do not provide robust protection for databases, organizations are increasingly relying on contracts that define rights and restrictions to protect their data.

When learning how to best to handle data, companies need to know what sources it is coming from, said Lee Tiedrich, a partner at Covington. Knowing the type of data is quite important, he said, since data comes in many forms. For example, open or proprietary data should be handled differently than user contributions and scraped data that comes off of public websites.

Differences between U.S. and European intellectual property laws also factor into database protection. Clients need to know how to source data properly because they want to protect their rights to their data and reduce their liability risks, Tiedrich said.

There is no sui generis database protection in the U.S., a term which means databases do not have strong legal protections. This is not unusual as intellectual property laws in the U.S. typically do not provide protection for databases, said Tiedrich.

From a EU legal perspective, there may be some form of IP protection in data but that does not eliminate privacy requirements applying to that data, said Freddie Argent, a partner at Covington.  

The panelists also discussed key terms of contracts for data licensors. Data licensors need to employ best practices, have standardized terms, and apply consistency across deals, said Adrian Perry, partner at Covington. Terms of service and privacy policies require clarity with the licensee acknowledging and accepting it, Perry added.

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Copyright

In Google v. Oracle, Supreme Court Hears Landmark Fair Use Case on Software Copyright

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Photo of Tom Goldstein from the Peabody Award used with permission

October 12, 2020 – The Supreme Court on Wednesday publicly struggled with the copyrightability of software in a uniquely contested case between Google and Oracle, the outcome of which could play a significant role in the future of software development in the United States.

The oral arguments were the culmination of a battle that started 10 years ago, when tech company Oracle accused Google of illegally copying its code. Oracle owns the copyright to the Java application programming interface that Google utilized to establish a new mobile operating system.

The company has sued Google for more than $9 billion in damages.

Yet Google claimed a “fair use” defense to its copying. Google copied less than 1 percent of the Java code. Even though the law generally treats computer programs as copyrightable, Google’s attorney before the Supreme Court, Thomas Goldstein, said that by adapting Oracle’s code to serve a different purpose, Google’s use was “transformational,” and entitled to fair use protections.

Goldstein said that this form of unlicensed copying is completely standard in software, and saves developers time and lowers barriers to innovation.

He referenced a famous Supreme Court precedent about public domain works, Baker v. Selden, which in 1880 declared that once information is published to the public, the public has a right to use it.

“Google had the right to do this,” said Goldstein.

Still, Oracle attorney Joshua Rosenkranz asserted that the Java code is an expressive work eligible for copyright protections. Rosenkranz further argued that Google’s use of the code was not transformational.

Justice Sonia Sotomayor appeared to suggest that jurors in the lower court case properly found Google’s use to be transformational because it took the APIs from a desktop environment to smartphones.

“Interfaces have been reused for decades,” said Goldstein. Google had to reuse Oracle’s code to respond to interoperability demands.

“It has always been the understanding that this purely functional, non-creative code that is essentially the glue that keeps computer programs together could be reused, and it would upend that world to rule the other way,” he said.

Supreme Court observers said that the high court appeared leaning toward upholding the 2016 jury verdict vindicating Google’s fair use defense.

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