The Knockoff Economy

by Kal Raustiala

  34. McLaughlin, “That Melon Tenderloin,” reports that Wickens said that he would tell patrons of Interlude that the dishes in question originated in American restaurants. The apology is noted in the eGullet commentary, by an Alinea staff member.

  35. Campbell v. Acuff-Rose Music, 510 U.S. 569 (1994).

  36. Quoted in Buccafusco, “On the Legal Consequences of Sauces,” 1152.

  37. Ibid., 1153.

  38. Interview with Joachim Splichal, Chef, Patina Catering Company.

  39. Interview with Laurent Torondel, Chef, Bistro Laurent Torondel.

  40. With the exception of the Buccafusco and Von Hippel/Fouchart papers, which we’ve noted elsewhere in this book.

  41. Robert Ellickson, Order without Law: How Neighbors Settle Disputes (Harvard University Press, 1994).

  42. Emmanuelle Fauchart|Eric von Hippel, “Norms-Based Intellectual Property Systems: The Case of French Chefs,” Organization Science 19.2 (2008): 187.

  43. Eric von Hippel, “Cooperation between Rivals: Informal Know-How Trading,” Research Policy 16.6 (1987): 291.

  44. Emily Cunningham, “Protecting Cuisine under the Rubric of Intellectual Property Law: Should the Law Play a Bigger Role in the Kitchen?” Journal of High Technology Law 9.1 (2009): 21.

  45. Pete Wells, “New Era of the Recipe Burglar.”

  46. Fauchart and von Hippel, “Norms-Based Intellectual Property,” 191.

  47. Bridgeport Music, Inc. v. Dimension Films, 410 F.3d 792 (6th Cir. 2005).

  48. Bret Thorn, “Catch-22: For Celebrity Chefs, the Bigger They Are, the Less They Usually Cook,” Nation’s Restaurant News, April 26, 2004.

  49. Fauchart and von Hippel, “Norms-Based Intellectual Property.”

  50. Michel Orecklin and Laura Locke, “Food for Thought,” Time, 2004, www.time.com/time/magazine/article/0,9171,994185,00.html (quoting Nancy Seryfert of the California Culinary Academy); Chefography (Food Network Broadcast).

  51. James Hibberd, Cable Year End Ratings, The Live Feed, November 30, 2011, www.hollywoodreporter.com/blogs/live-feed/cable-year-ratings-usa-hbo-52808.

  52. Michael Pollan, “Out of the Kitchen, Onto the Couch,” New York Times Magazine, August 2, 2009.

  53. Ibid.

  54. Katy McLaughlin, “Chefs Gone Wild: Where to Eat this Fall,” Wall Street Journal, September 17, 2005.

  55. Twentieth Century Music Corp. v. Aiken, 422 U.S. 151 at 156 (1975).

  56. Adria et al., “Statement,”.

  57. Jonathan Gold, “The New Cocktailians,” L.A. Weekly, March 4, 2009.

  58. Chantal Martineau, “The Era of Copyrighted Cocktails?” The Atlantic, August 31, 2010.

  59. Jonathan Miles, “The Right Stuff (By Law),” New York Times, July 2, 2009.

  60. Nick Fauchald, “Secrets of a Cocktail Master,” Food & Wine, www.foodandwine.com/articles/secrets-of-a-cocktail-master.

  61. Martineau, “The Era of Copyrighted Cocktails?”.

  CHAPTER 3

  1. Melvin Helitzer, Comedy Writing Secrets: How to Think Funny, Write Funny, Act Funny and Get Paid For It (Writers Digest Books, 1987), 4.

  2. This chapter is adapted from Dotan Oliar and Christopher Sprigman, “There’s No Free Laugh (Anymore): The Emergence of Intellectual Property Norms and the Transformation of Stand-Up Comedy,” Virginia Law Review 94.8 (2008): 1787. All interview excerpts in this chapter are taken from the Oliar/Sprigman article, unless noted otherwise.

  3. Silo360, Joe Rogan and Carlos Mencia Fight, www.youtube.com/verify_age?next_url=http%3A//www.youtube.com/watch%3Fv%3D5gVYfDCgYxk (accessed June 6, 2011).

  4. See Silo360, Joe Rogan and Carlos Mencia Fight; nomencia, Mencia Steals from Cosby? www.youtube.com/watch?v=lCixAktGPlg at 1:18-2:03 (accessed June 6, 2011) (comparing Mencia and Cosby versions of a bit); deadfrogcomedy, George Lopez v. Dave Chappelle: Is This Joke Stealing? www.youtube.com/watch?v=-OHMeDqhAgU at 0:15-1:16 (accessed June 6, 2011) (comparing Mencia and Chappelle versions of a bit); deadfrogcomedy, Whose Joke Is It? Carlos Mencia? D.L. [sic] Hughley? George Lopez? www.youtube.com/watch?v=kPuu_VE7KOA at 0:14-0:27 (accessed June 6, 2011) (comparing a bit used by multiple comedians).

  5. Oliar and Sprigman, “There’s No Free Laugh (Anymore).”

  6. These joke files were valuable property and were sometimes sold. Joey Adams and Henry Tobias, The Borscht Belt (Bentley Pub. Co., 1966), 61 (“When [Henny] Youngman and Henry Tobias heard that the file of one of the funniest standup comics in vaudeville, Richy Craig, Jr., was on the block, they begged and borrowed and sold their clothes to get enough money to grab it. Then they split it between them. It was like an investment. Not only did they have fresh material, but they made copies and peddled them to other emcees at a profit”).

  7. Milton Berle also maintained a large joke file. He published only its crème-de-lacrème in two heavy volumes, which he had the chutzpah to copyright. See Milton Berle, Milton Berle’s Private Joke File (Three Rivers Press, 1992); Milton Berle, More of the Best of Milton Berle’s Private Joke File (Book Sales, 1996). Bob Hope also maintained his own joke file, which he contributed before his death to the Library of Congress. Bob Hope and American Variety: Joke File (December 29, 2004), www.loc.gov/exhibits/bobhope/jokes.html (accessed June 6, 2011).

  8. See, e.g., Adams and Tobias, The Borscht Belt, 61 (“[Henny] Youngman’s style of delivery kept him joke broke. Like all Toomlers his need for new, fresh material was complicated by the fact that he worked to repeater guests season after season. The usual method of obtaining material (by most Social Directors) was to lift from the best. Any opening day at Loew’s State or the Palace found a dozen comics in the audience, pencils akimbo.”).

  9. See Thrilling Days of Yesteryear, http://blogs.salon.com/0003139/2004/02/22.html (February 22, 2004) (containing transcript of The Milton Berle Show from January 20, 1948).

  10. See deadfrogcomedy, Whose Joke Is It? Carlos Mencia? D.L. [sic] Hughley? George Lopez? www.youtube.com/watch?v=kPuu_VE7KOA at 0:14-0:27 (accessed June 6, 2011).

  11. Ibid.

  12. Much of this part of the chapter draws on this work, originally published as Oliar and Sprigman, “There’s No Free Laugh,” 60.

  13. See nomencia, Mencia Steals from Cosby? www.youtube.com/watch?v=lCixAktGPlg at 1:18-2:03 (accessed June 6, 2008) (comparing Mencia and Cosby versions of bit).

  14. Ibid. at 0:09-1:17.

  15. See Robert W. Welkos, “Funny, That Was My Joke.” L.A. Times. July 24, 2007, A1(quoting Cosby as saying that joke stealing involves the performer accepting acclaim under “false pretenses” of originality and that whenever Cosby would use other comedians’ material he would give public attribution).

  16. See Lopez, www.redban.com/audio/lopez.mp3 at 0:40-1:46 (accessed June 6, 2011) (providing George Lopez’s description on the Howard Stern radio show of his physical attack on Mencia); see also Q&A 12-01-06, www.redban.com/audio/dco.mp3 at 27:23-27:50 (accessed June 6, 2011) (providing the account of Jamie Masada, owner of the Laugh Factory in Los Angeles, who claimed to have witnessed Mencia and Lopez “almost killing each other”).

  17. See deadfrogcomedy, George Lopez v. Dave Chappelle: Is This Joke Stealing? www.youtube.com/watch?v=-OHMeDqhAgU at 0:15-1:16 (accessed August 18, 2008).

  18. See Judy Carter, The Comedy Bible: From Stand-up to Sitcom—the Comedy Writer’s Ultimate How-to Guide (Touchstone, 2001), 56. See also Dave Schwensen, How to be a Working Comic: An Insider’s Guide to a Career in Stand-Up Comedy 16 (Back Stage Books, 1998) (“What you never want to do is plagiarize another act. In other words, don’t be a carbon copy of someone else. It could haunt you in more ways than one. Comedians are very protective of their material…. [W]hat they perform onstage is the basis of their careers and it’s not for someone else to ‘steal’ and profit from. Beginners sometimes fall into the plagiarism trap because they don’t understand what’s expected from them when they first walk onstage…. A major point of this book is that to make it as a stand-up comic, you must be an original.”).

  19.
Here is one comedian’s description of such a cooperative dispute resolution:

  What you learn as a child is if you have a problem with someone you go and you talk to them…. So if somebody has a joke that sounds like mine… I’ll just go up to the person and say “Hey, listen, I do this joke, that joke sounds a little bit similar,” and then we talk it out. And they’ll say blah, blah, blah. And then one of us will say, “all right I’ll stop doing it.” And that’s that. It’s done.

  20. See Dean Johnson, “Stop! Thief!: Comics Say They’re Getting a Bad Rap,” Boston Herald, August 14, 1998, S03, available at 1998 WLNR 270264.

  21. See Brian McKim, “Stolen Goods,” SHECKYmagazine.com, December 2002, www.sheckymagazine.com/mckim/mck_0301.htm.

  22. Ibid., 78.

  23. This discussion is largely adapted from Jacob Loshin, “Secrets Revealed: How Magicians Protect Intellectual Property without Law,” in Law and Magic: A Collection of Essays, Christine A. Corcos, ed. (Carolina Academic Press, 2010), 123.

  24. The famous “Metamorphosis” illusion is an example. Nineteenth-century magician John Nevil Maskelyne invented the trick, but Harry Houdini popularized it. Nevil Maskelyne and David Devant, Our Magic: The Art in Magic, the Theory of Magic, the Practice of Magic (George Routledge and Sons Limited, 1912), 67.

  25. Ibid.

  26. Rice v. Fox Broadcasting Co., 330 F.3d 1170 (2003).

  27. Eriq Gardner, “Teller of Penn & Teller Breaks Silence to Sue Over Magic Trick,” The Hollywood Reporter, April 15, 2012.

  28. Additionally, to the extent that the pantomime is truly necessary to the performance of the uncopyrightable trick, a long-established element of the copyright law known as the “merger doctrine” very likely nullifies any copyright in the pantomime.

  29. Goldin v. Clarion Photoplays, Inc., 202 A.D. 1, at 4 (N.Y. App. Div. 1922).

  30. Paul Brownfield, “What’s This Guy Got Up His Sleeve?” L.A. Times, March 3, 1998.

  31. “Criss Angel Makes Magicians Disappear—With Help from Security,” Radar Online, September 10, 2010, www.radaronline.com/exclusives/2010/09/criss-angel-makes-magicians-disappear-with-help-security.

  CHAPTER 4

  1. www.vanguard.com/bogle_site/lib/sp19970401.html.

  2. “Bill Walsh and Joe Montana: The Genius and the Gun,” Football Digest, December 1982 Interestingly, back in 1986, a federal appeals court held that a baseball game is a protectible work of authorship. See Baltimore Orioles v. Major League Baseball Players Association, 805 F.2d 663 (7th Cir. 1986). By 2005, however, the same court signaled that it was no longer following its previous holding. See Toney v. L’Oreal USA, 406 F.3d 905 (7th Cir. 2005) (noting that the holding in the Orioles case had been “widely criticized by our sister circuits and by several commentators.”).

  3. Ibid.

  4. For more on the importance of tweaking, see Malcolm Gladwell, “The Tweaker: The Real Genius of Steve Jobs,” The New Yorker, November 14, 2011.

  5. Tim Layden, Blood, Sweat and Chalk, The Ultimate Football Playbook: How the Great Coaches Built Today’s Game (Sports Illustrated Books, 2010).

  6. Pete Thamel, “Nevada’s Runaway Offense,” New York Times, October 10, 2010.

  7. Nicholas Dawidoff, “Rex Ryan: Bringing It Big,” New York Times Magazine, September 12, 2010.

  8. 209 U.S. 1 (1908).

  9. Gladwell, “The Tweaker.”

  10. Ibid. Gladwell draws on Ralf Meisenzahl and Joel Mokyr, “The Rate and Direction of Invention in the British Industrial Revolution: Incentives and Institutions,” NBER Working Paper 16993 (April 2011), www.nber.org/papers/w16993.pdf. They note that patent played a small role in this process; instead “many workmen relied on secrecy and first-mover advantages to reap the benefits of their innovations. Over 40% of the sample here never took out a patent.” Ibid., abstract.

  11. Madey v. Duke University, 307 F. 3d. 1351 (2002). The court found Duke liable for patent infringement when Duke continued to use Madey’s patented laser for research purposes after Madey had left the university. Previously, courts had allowed researchers to use patented technologies for basic scientific research that was not directly aimed at commercial use. Madey v. Duke University made clear that this exception would be construed very narrowly—any experimental use that was motivated by more than “mere curiosity” and could lead eventually to a commercial use was out of bounds. This is a narrow exception, and it makes it difficult to tweak a patented invention without the threat of liability. Moreover, the courts’ constriction of experimental use creates a big tension in patent law. On the one hand, patent law grants some rights to Tweakers who make an improvement. But on the other, it makes it hard for Tweakers to do the basic research necessary to make that improvement in the first place.

  12. One long-standing exception to this general rule was the high-end art world, where tweaking was fairly common (under the guise of “appropriation”) and rarely prosecuted. In 2011, however, a ruling against the artist Richard Prince cast considerable doubt on this practice, sending shock waves throughout the art world and prompting protests from many quarters, including the Metropolitan Museum of Art and Museum of Modern Art.

  13. Calligraphy, the predecessor to fonts, allows this too, but the range of variation is narrower and replicability more difficult to achieve.

  14. Released in 2007; see www.helveticafilm.com/.

  15. H.R. Rep. No. 94-1476, at 55.

  16. Eltra v. Ringer, 579 F.2d 294 (4th Cir. 1978); Leonard Storch Enters., Inc. v. Mergenthaler Linotype Co., No. 78-C-238, 1979 WL 1067 (E.D.N.Y. 1979).

  17. Fonts are not “inherently distinctive”—i.e., the trademark law (correctly) does not presume that consumers looking at a font will associate it with a particular producer. And it would be difficult, if not impossible, to show that any particular font has acquired distinctiveness out in the marketplace.

  18. Alexander Lawson, Anatomy of a Typeface (Godine, 1990), 386-89.

  19. Anthony Cahalan, Type, Trends and Fashion: A Study of the Late Twentieth Century Proliferation of Typefaces (Mark Batty, 2008), 61.

  20. Randall Rothenberg, Computers Change the Face of Type,” New York Times, July 23, 1990, D1.

  21. Caitlin Liu, “Creating a New Generation of Vivid Typefaces,” New York Times, August 5, 1996, D5.

  22. Cahalan, Type, Trends and Fashion.

  23. See, e.g., Philip W. Snyder, “Typeface Design after the Desktop Revolution: A New Case For Legal Protection,” 16 Columbia-VLA Journal of Law & the Arts 16.1 (1991): 97, 98 n.3.

  24. Blake Fry, “Why Typefaces Proliferate without Copyright Protection,” Journal on Telecommunications & High Technology Law 8.2 (2010): 425.

  25. See http://seekingalpha.com/article/216283-stock-market-capitalization-exceeds-gdp.

  26. Peter Tufano, “Financial Innovation and First Mover Advantages,” 25 Journal of Financial Economics 25.2 (1989): 213.

  27. State Street Bank and Trust Co. v. Signature Financial Group Inc., 149 F.3d 1368 (Fed. Cir. 1998).

  28. Robert M. Hunt, “Business Method Patents and U.S. Financial Services,” Contemporary Economic Policy 28.3 (July 2010): 322-52.

  29. Robert P. Merges, “The Uninvited Guest: Patents on Wall Street,” Economic Review Q4 (2003): 1-14.

  30. Josh Lerner, “Trolls on State Street? The Litigation of Financial Patents, 1976–2005,” mimeo, Harvard Business School (2006).

  31. Hunt, “Business Method Patents,” p. 333.

  32. Ibid.

  33. Peter Tufano, “Financial Innovation,” in George M. Constantindes, Milton Harris and René M. Stulz eds., The Handbook of the Economics of Finance (Elsevier, 2003).

  34. Ibid.

  35. Ibid.

  36. Merges, “The Uninvited Guest.”

  37. See Sugato Battacharyya and Vikram Nanda, “Client Discretion, Switching Costs, and Financial Innovation,” Review of Financial Studies (Winter 2000): 1101-127.

  38. Robert C. Merton, “On the Application of the Continuous-Time Theory of Finance
to Financial Intermediation and Insurance,” The Geneva Papers on Risk and Insurance 14 (July, 1989): 225.

  39. See www.ncbi.nlm.nih.gov/omim.

  40. 499 U.S. 340 (1991).

  41. www.dialog.com.

  42. Commission of the European Communities, DG Internal Market and Services Working Paper, First Evaluation of Directive 96/9/EC on the Legal Protection of Databases, at §1.4, Brussels, 12 December 2005, http://ec.europa.eu/internal_market/copyright/docs/databases/evaluation_report_en.pdf.

  43. Ibid., § 4.2.1

  44. See ibid., Figure 7.

  45. http://projects.latimes.com/value-added/faq/#database_grades.

  CHAPTER 5

  1. See Dennis Dutton, The Art Instinct: Beauty, Pleasure and Human Evolution (Bloomsbury Press, 2009).

  2. Douglas G. Lichtman, “The Economics of Innovation: Protecting Unpatentable Goods,” Minnesota Law Review 81.3 (1997): 693.

  3. The nature of that monopoly varies; under copyright law, for instance, if someone else independently creates the same work, they have not “copied” the first work and therefore have broken no laws. Patent has a stricter standard. A second inventor who unwittingly (and without copying) invents the same device or method cannot use it commercially without violating the first inventor’s patent.

  4. E.g., Robert Levine, Free Ride: How Digital Parasites Are Destroying the Culture Business, and How the Culture Business Can Fight Back (Doubleday, 2011).

  5. This is not to say that there are not serious criticisms of our IP laws. For some of the best work in this vein see, e.g., Jamie Boyle, The Public Domain: Enclosing the Commons of the Mind (Yale, 2008); Neil Netanel, Copyright’s Paradox (Oxford, 2008); and Larry Lessig, Free Culture: The Nature and Future of Creativity (Penguin, 2004)

  6. Present in this hypothetical are also what economists call positive and negative externalities. The New Palgrave Dictionary of Economics (Palgrave Macmillan, 2008) defines externalities as “indirect effects of consumption or production activity, that is, effects on agents other than the originator of such activity which do not work through the price system.” The interaction between copying and externalities is interesting. The second café might enjoy positive externalities from the first, especially if the first has more business than it can handle at certain times and hence customers “spill over” into Café #2. And the later followers of both cafés enjoy the positive externalities of the first two as the street transforms into a destination spot. But the owner of Café # 1 also experiences negative externalities as the second owner outcompetes him for some customers. Customers, of course, are the overall winners as they experience more choice and, eventually, better quality and lower prices induced by competition.